Bitcoin Bulls Bank on Fed’s ‘Stealth’ Rate Cuts: Crypto Daybook Americas
Bitcoin bulls anticipate liquidity easing via Fed rate cuts, potentially returning to zero as in 2020-21, triggering a bull run. A Federal Reserve analysis shows a 9% chance of this within seven years, although the probability is only 1% in the next two. However, unforeseen events could expedite this. Currently, rates stand at 4.25%, with traders predicting one 25 basis-point cut this year. Simultaneously, the Fed is subtly easing liquidity through measures like reducing the “enhanced supplementary ratio.” This, coupled with the Treasury’s expanded buyback program, is fueling bullish expectations, evidenced by large traders’ investment in $130K Bitcoin call options on Deribit. U.S.-listed spot Bitcoin ETFs saw their third consecutive day of net inflows on Monday, and bullish futures bets on XRP are also increasing.
Bit Digital completed its strategic shift to Ether (ETH) following a $172 million equity raise and BTC sale. Dubai approved the QCD Money Market Fund, a collaboration between Qatar National Bank and DMZ Finance. Australia’s DigitalX raised A$20.7 million ($13.5 million) to increase its Bitcoin holdings. In Europe, 53 companies secured licenses in six months since the EU’s MiCA regulation, showcasing demand for compliant products; Tether, however, is yet to seek a license. Traditional markets show renewed volatility, with the Japanese 30-year government bond yield reaching its highest since May 22nd.
Upcoming events include the Isthmus hard fork activation on Celo’s mainnet on July 9th, a Singapore High Court hearing on WazirX’s restructuring on July 14th, and the launch of Alchemist staking and Lynq’s digital asset settlement network on July 15th. Macroeconomic data releases include Brazilian and Mexican inflation data, FOMC minutes, and U.S. unemployment figures. A Senate Banking Committee hearing on digital asset markets will also take place. Several token unlocks and launches are scheduled throughout July and August, along with various conferences. Sei Network’s TVL reached a record high, attributed to increased on-chain activity and regulatory approval in Japan. Despite the positive developments, SEI remains volatile. Derivatives positioning shows a bearish bias for some tokens and a moderate bullish bias for others. Bitcoin and Ether activity on CME remains subdued.
