Coinspeaker

13 hour ago

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Fed Cuts Rate Again, Bitcoin ETFs See $223.5M Inflows

The US Federal Reserve announced its third consecutive interest rate cut for 2025, reducing the main interest rate by 25 basis points to a target range of 3.5% to 3.75%. This is the lowest in approximately three years.

• The Fed's decision led to significant gains in both stock and crypto markets.
• Dow Jones Industrial Average increased by 500 points or 5%.
• Bitcoin surpassed $94,000; Ethereum reached $3,440.
• Spot BTC exchange-traded funds saw a net inflow of $223.5 million, with major contributions from BlackRock’s IBIT ($192.9 million) and Fidelity’s FBTC ($30.6 million).

Investors experienced FOMO due to the rate cut, as lower interest rates typically make risk assets more appealing. However, Santiment data indicates that this euphoria was short-lived.

Fed officials remain divided on inflation control policies, potentially increasing market volatility amidst slowing US economic growth. With rates at a three-year low, the Fed has limited options if the economy worsens unexpectedly.

Some traders opted to sell digital assets amid negative expectations, resulting in a 2.66% decline in the global crypto market cap to $3.08 trillion. Bitcoin now trades at $90,200, while Ethereum stands at $3,200.