The Federal Reserve has not raised interest rates, my mortgage hasn't decreased, yet ETH has risen first.
After last week's Federal Reserve meeting, I came across two pieces of news simultaneously:
Powell said inflation is still high, but the trend is improving, and there may be an interest rate cut within the year.
ETH price broke through $2500, with a weekly increase of nearly 10%
At that moment, I thought: how can the Federal Reserve's statement not reduce my mortgage, yet ETH has already risen? This logic sounds absurd, but in the crypto world, it makes perfect sense. Today, let's start from this point and talk about why ETH is so sensitive and why it has risen first.
1. Why is ETH so high on the expectations of interest rate cuts?
In traditional markets, interest rate cuts represent liquidity easing, making it easier for asset prices to rise; while in the crypto world, assets like ETH
Tech growth-type assets are more sensitive to interest rates.
Simply put, when interest rates loosen, money starts to stir.
People begin to ask, 'Is ETH undervalued?' Let's look at the data from these past few days:
▪️ ETH has risen 9.7% in the last 7 days, current price $2,513
▪️
Significant funds are flowing in: 24-hour trading volume exceeds $10.6 billion
▪️ Market sentiment indicators have returned to the 'greed' range
▪️ Total Lido staking volume has returned above 9M ETH, long-term bullish sentiment is rising
In other words, ETH is now like a kite waiting for the wind; once the interest rate expectations loosen, it will take off.
2. ETH is not just rising in price; it’s a re-confirmation of logic.
ETH did not suddenly get better; its value support has been building for nearly a year:
▪️ The Pectra upgrade is expected to launch in Q4, including features like account abstraction and EIP-7702.
▪️ The L2 ecosystem is booming: Arbitrum, OP Stack, Base, etc., continue to expand
▪️ ETF speculation: Grayscale and BlackRock have submitted applications for ETH spot ETFs, the SEC will respond in May (key date: around May 23)
These things have happened before, but no one acted because there was a hammer hanging over us at the macro level. Now that the Federal Reserve is less hawkish, the old logic of ETH seems particularly fresh—like that coat in your wardrobe that you thought was useless in winter, but when spring comes, you suddenly realize: it's really nice.
3. Ordinary people can also find a reference point in this market trend.
I know many people think that I don't understand the Federal Reserve when they see the ups and downs. They think, what does it matter to me whether they raise interest rates? But in fact, we don't necessarily need sophisticated models to make decisions; life experiences serve as a good analogy.
For example, a friend of mine used to complain every day that his salary couldn't keep up with inflation, but as soon as ETH went up, he immediately jumped in to add to his position.
I asked him, 'Didn't you say you didn't have money?'
He said, 'ETH is rising, which means the liquidity story is starting.' This answer is not professional, but it's quite honest.
Because you will find: price is actually the best signal. It may not tell you the future, but it will tell you—there is wind now.
No one can guarantee whether ETH can rise to $3000 or $3500. But this wave is not based on wishful thinking; rather, it is a re-aggregation of multiple logics:
▪️ Macro interest rate expectations have eased
▪️ The technology ecosystem continues to expand
▪️ Market sentiment is starting to warm up
To put it simply, the wind is coming; are you ready with your sails? Of course, I don't recommend everyone to go all in, nor to blindly FOMO.
But if you already have ETH in your hands or are preparing to participate in the crypto space,
At the very least, you should know: ETH is not rising because of the general market; it has its own momentum.
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