Crypto Market Surges as Fed Rate Cuts and Safe-Haven Demand Boost Prices
Teh crypto market is experiencing a meaningful rally this week,with Bitcoin and Ethereum approaching their all-time highs. The total market cap has surpassed $4.2 trillion. Here are the main factors driving this surge.
Fed Rate Cuts on the Horizon
The possibility of the Federal Reserve cutting interest rates is a key driver.After the ADP jobs report showed a loss of 36,000 jobs in september, the odds of a rate cut increased.this could lead the Fed to lower rates to support the economy.Historically,cryptocurrencies perform well during such periods.
Bitcoin as a Safe-Haven Asset
Bitcoin is gaining traction as a safe-haven asset, especially during the U.S. government shutdown. blackrockās white paper highlights bitcoinās strong fundamentals, like its limited supply and growing demand. This is evident in the recent ETF inflows, with Bitcoin ETFs adding $3.2 billion in assets.
Seasonal Trends in Play
Seasonality is also contributing to the rally.October, often referred to as āUptober,ā is historically a strong month for Bitcoin, with an average return of 20% since 2013.
Altcoin ETF Approvals on the Radar
The potential approval of altcoin ETFs by the Securities and Exchange Commission is another factor.The SEC has set October as the deadline for several altcoin ETFs, including Solana and XRP. If approved,this could attract more institutional investors,further boosting prices.
