Interest Rates Slashed by 25 Basis Points by US Federal Reserve, Bitcoin Value Responds

The US Federal Reserve has reduced interest rates by 25 basis points in an effort to stabilize a seemingly faltering labor market. This decision, the second consecutive rate cut, coincides with a protracted government shutdown. Concurrently, Bitcoin's price has seen a 3% drop, trading around $111,400. Despite a somewhat heightened $560 million liquidation in the derivatives markets, the total cryptocurrency market capitalization remains at $3.86 trillion. This rate cut was largely expected, with traders in prediction markets like Polymarket having predicted this outcome for weeks. Furthermore, the Fed's chair, Powell, announced the cessation of asset purchase reduction from December 1, a process known as quantitative tightening. However, the ongoing government shutdown has obstructed the collection of crucial economic data, presenting challenges for policymakers.