#美国众议院市场结构讨论草案 Hello, everyone! Today, let's talk about the latest actions of the Federal Reserve - a 25 basis point interest rate cut! This is a major event for our cryptocurrency space.

News Overview

According to the latest news, the Federal Reserve cut interest rates by 25 basis points in May, lowering the federal funds rate to 2.7%. This is the second rate cut of the year (the FOMC meeting is expected to have one more rate cut this year, with about a 17% probability). Currently, the market's expectation for the Federal Reserve to continue cutting rates is as high as 97.3%! If another 25 basis points are cut by the end of the year, the rate will drop to 2.4%, making the cumulative rate cut potentially reach 50 basis points. However, there is still significant volatility in the market's expectations for rate cuts, with a 0.8% probability of no cuts this year.

Analysis of the Impact of Rate Cuts on the Cryptocurrency Market

Increased liquidity, positive for the crypto market

The Federal Reserve's rate cut means that market liquidity will increase, and the cost of capital will decrease, potentially leading more funds to flow into risk assets, such as our cryptocurrencies! Historically, rate cut cycles are often catalysts for the rise of mainstream coins like BTC and ETH. Especially for BTC, it may welcome a wave of capital influx, so keep an eye on it.

Market sentiment is high, short-term volatility increases

The 97.3% expectation of a rate cut indicates that market sentiment is very optimistic, but the 0.8% probability of no cut also reminds us that market volatility may intensify. In the short term, altcoins may experience significant fluctuations, and it is recommended that everyone manage their risks well and avoid chasing highs!

Long-term trend: A rate of 2.4% may become a key point

If the interest rate really drops to 2.4% by the end of the year, it would be a significant positive for the cryptocurrency space! In a low interest rate environment, investors are more inclined to seek high-yield assets, and the crypto market may attract more institutional funds. However, a cumulative cut of 50 basis points could also overheat the market, so everyone should be wary of the risks of a subsequent policy shift.