Cryptos slip as Powell doubles-down on delaying rate cuts

Bitcoin slipped further Tuesday as researchers warn that the next halving event is likely already priced in

article-image

愚木混株 cdd20/Unsplash modified by Blockworks

share

Cryptocurrencies extended their decline Tuesday while stocks posted a modest rebound following Monday’s stronger-than-expected retail sales data. 

Bitcoin and ether slid around 3% each Tuesday, erasing Monday’s slight gains. Bitcoin hovered around $62,400 at time of publication. The largest cryptocurrency looks poised to enter its next halving — expected to happen late this Friday — in the red. 

While some traders are betting on the halving being bitcoin’s next catalyst for a run, researchers warn that the event is likely already priced in. 

“The halving itself is already known to all market participants, so something like a decrease in issuance that’s already well-known theoretically shouldn’t impact the market at all,” Michael Zhao, researcher at Grayscale, said. 

Equities on Tuesday inched into the green. The S&P 500 and Nasdaq Composites gained about 0.1% by mid-way through the trading session. 

US retail sales in March increased 0.7%, according to data released by the Commerce Department Monday. Analysts had expected a 0.4% rise. The report, coupled with last week’s hotter-than-expected inflation data, has traders skeptical that the Federal Reserve will cut interest rates before this summer. 

A healthy consumer market, as good as it may seem, is not boding well for the interest rate cutting schedule. CME futures data show a 0.4% chance of a rate cut in May and a 19% chance central bankers will slash rates in June. 

“More recent data show solid growth and continued strength in the labor market, but also a lack of further progress so far this year on returning to our 2% inflation goal,” Fed Chairman Jerome Powell said Tuesday during a panel discussion at the Washington Forum on the Canadian Economy. 

Rates are going to have to stay higher for longer, he added, confirming the widespread market sentiment. 

“Fed Expectations has hopes for a June rate cut dashed by the hot CPI report and now the market must deal with the possibility of just two — or even fewer — rate cuts in 2024,” Tom Essaye, founder of Sevens Report Research, said. “Remember the market started the year expecting seven cuts.”


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research Report Templates (6).png

Research

In recent months, a number of highly accretive developments were implemented across the protocol to improve fee capture, expand product functionality, and ultimately drive value accrual to the RUNE token, with more upgrades on the immediate horizon. These developments include hiking the minimum swap fee parameter to increase revenue, adding a Burn System Income Lever to reduce the RUNE supply, the addition of COSM-WASM smart contracting and IBC to enable an application layer, new chain integrations, and more.

article-image

Former IRS agent and Binance executive Tigran Gambaryan will remain imprisoned in Nigeria’s Kuje prison

article-image

When Permissionless III wraps on Friday, there will be 26 days left until the 2024 presidential election

article-image

Plus, an update from the ground in Salt Lake City at Permissionless III

article-image

The US regulator accused the crypto market-making firm of acting as an unregistered dealer

article-image

Customers can pay merchants in USDC or USDP on Ethereum, Solana, and Polygon, while US-based merchants are paid in dollars