Fed Cuts Interest Rates by 50 Basis Points, Signaling New Bullish Cycle for Crypto

The Federal Reserve announced after the Federal Open Market Committee (FOMC) meeting that the target range for the federal funds rate will be lowered from 5.25% to 5.50% to 4.75% to 5.0%, a reduction of 50 basis points.

Jeffrey Ding, Chief Analyst at HashKey Group, stated: "The darkness before dawn has passed, and a new wave of bullish momentum has begun. The Fed's 50 basis point cut signals a clear concern about the current economic environment, necessitating a more aggressive rate reduction cycle."

The global economy faces liquidity challenges, and this interest rate cut injects new life into the global financial markets.

Bitcoin, as the "digital gold" of the new era, has performed strongly in this context, breaking through the $62,000 mark in the short term. However, this benefit isn't limited to Bitcoin alone; the entire cryptocurrency market is expected to experience a new wave of bullish activity in the context of this looser monetary policy.

It's crucial to note that unlike traditional markets, Bitcoin's performance is more strongly influenced by US dollar liquidity than changes in the US economic outlook. This implies that in the upcoming loose monetary environment, Bitcoin may continue to be a preferred asset for investors seeking inflation protection and safe havens.

As the rate reduction cycle continues, the cryptocurrency market could enter a prolonged upward trend. Volatility remains a factor, but this new bullish cycle could draw more capital and innovation to the sector, propelling the entire crypto ecosystem into a new stage of development.