Cryptos continue to pare losses ahead of Fed decision

If all goes according to plan during tomorrow’s Fed rate decision announcement, risk-on sentiment could be back

article-image

Shizume/Shutterstock and Adobe modified by Blockworks

share

Bitcoin and ether continued to pare gains Tuesday while stocks trended upward ahead of Wednesday’s Federal Reserve decision. 

Bitcoin posted mild losses Tuesday afternoon, positioning the largest crypto more than 5% lower over the past five days. Ether was trading around 2.3% lower Tuesday, also extending a mild selloff that started Monday. 

Both cryptos managed to stay above key levels, though, with bitcoin (BTC) hovering around $41,000 and ether (ETH) sitting just below $2,200. 

In the altcoin space, Solana, after increasing more than 22% in three days earlier this month, also cooled down Tuesday. The rally, spurred by Solana-based liquid staking protocol Jito’s governance token airdrop last week, appears to have cooled. 

Jito’s JTO, which debuted at a price of $1.20 per token, gained as much as 261% last week before dipping to around $2.92 Tuesday. 

Read more: What to know about Jito’s $165M JTO airdrop

Layer-1 protocol Aptos’ native token (ATP) soared as much as 17% Tuesday as 24.8 million, or 8.9% of its total supply, was unlocked. ATP’s market capitalization jumped more than 15% Tuesday to around $2.5 billion. 

Last month, when Aptos unlocked the same amount of tokens, ATP’s price plummeted to a low of $6.70. 

Aptos, which launched in October 2022, saw an increase of more than 200% in transactions between the second and third quarters of 2023, the blockchain said in a November 2023 update

What to watch this week 

Equities were modestly in the green again Tuesday, with the Nasdaq Composite and S&P 500 indexes posting gains of 0.5% and 0.3%, respectively. 

Traders are anticipating the Fed to keep interest rates where they are and extend its current forward guidance Wednesday. They also expect the central bank to update its expectations to place interest rates at 4.876% by the middle of 2024. If all goes according to plan it should push prices higher, analysts say. 

“As long as [Fed Chair Jerome] Powell isn’t too hawkish during the press conference, this outcome would likely spur a modest rally in stocks and could key a rally into year-end,” Tom Essaye, founder of Sevens Report Research, said. “To be clear, this outcome wouldn’t introduce anything new but it would remove the risk of a hawkish surprise and allow momentum to carry stocks higher into the end of the year.”


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

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

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2023

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research Report Cover Vertex.jpg

Research

The proliferation of new perp DEXs has led to fragmented liquidity across various DEXs and chains. Vertex, known for its vertically-integrated DEX that includes spot, perpetual, and integrated money markets, is now tackling cross-chain liquidity fragmentation through horizontal integration with the launch of new Edge instances. Vertex's integrated offerings and cross-margined account structure amplify the benefits of new instances: native cross-chain spot trading, optimized cross-chain basis trading, consistent interest rates, reduced bridging friction, and more.

article-image

Partnering with EtherFi and Angle, the fully on-chain perp DEX features bespoke collateral

article-image

Sponsored

Gavin Wood introduced the next evolutionary step for the Polkadot network: the Join-Accumulate Machine, or JAM

article-image

The side events were the places to be at Consensus 2024, according to attendees

article-image

Also, who’s come out swinging in the spot ether ETF fee war — and who could undercut them

article-image

I know it is not in their nature, but US regulators could learn a lot by researching the digital asset frameworks that overseas regulators have already gotten right

article-image

Also, the ETF hype train can count out at least one member