No products in the cart.
- Latest
- Trending
ADVERTISEMENT
Marcus Sotiriou, Analyst At a Listed Digital Asset Broker global block (TSXV:BLOK).
Bitcoin remains above $20,000 as US GDP records at 2.6% in the third quarter, above the expected 2.4% and significantly higher than the previous 0.6% decline.
So far, the market has reacted positively to the news, perhaps because the likelihood of a recession has diminished. But the positive reaction to the news could be short-lived, as it suggests the Federal Reserve has been given the green light to continue its aggressive policy measures and keep raising rates. .
This argument is supported by core PCE inflation at 4.5%, albeit lower than the previous month’s 4.7%.
If the Federal Reserve sees these numbers as an indication that inflation is currently the biggest problem to be addressed and, as a result, aggressive policy will continue, short-term volatility will Risky assets such as cryptocurrencies may react badly after being dissolved. This is because the Federal Reserve’s aggressive policies are draining liquidity from the market, causing the most liquid assets such as cryptocurrencies and stocks to sell off.
Even though the macro economy is currently bearish on risk assets, more governments are poised to become the next global hub for cryptocurrencies. The UK recently recognized Bitcoin and Ethereum as official regulated financial instruments. In addition, Hong Kong is now trying to draw cryptocurrency companies into the retail trade allowance by allowing the listing of Bitcoin and Ethereum trading platforms. I believe that government regulation could be an important catalyst for cryptocurrency adoption in the coming years.
