Jerome Powell, in his latest appearance at Jackson Hole, opted for the classic cautious rhetoric we already know: the Fed "will consider changes" in monetary policy, which in financial jargon means that a rate cut is on the table. Behind that carefully indeterminate language lies a bearish bias on interest rates, driven by an economy that appears stable (stable employment, promising data) but remains under the shadow of post-tariff inflation from Trump.
Predictably, the immediate reaction was a lightning rebound in risk assets, with a record Dow and the Nasdaq regaining strength. But the real show took place in the crypto space.
1. $ETH: the unexpected phenomenon
While $BTC flirted with $117,000 before stabilizing near $115,000 (by the way, a rebound without wild volatility, thanks to ETFs that cushion its movement).
Ethereum exploded with a 15% rally in just a few hours, nearing the historic highs of 2021, although not formally breaking them. The appetite for risk is clear: altcoins like Solana, Cardano, and Polkadot also surged.
ETFs seem to have encapsulated the volatility of $BTC, making it less attractive for traders in search of "profitable volatility". Ethereum, with its volatility still "under control but palpable", seems to be the new magnet for speculators.
2. More than just a market movement: the political consequences
A drop in Fed rates not only makes government and credit debt cheaper but also undermines the profitability of conventional savings, pushing money towards riskier assets like cryptocurrencies. This shows how monetary policy, far from being neutral, redistributes incentives and modifies market dynamics, generating speculative bubbles that the most vulnerable end up paying for.
Bitcoin maximalists scorn these increases of Ethereum and are betting without hesitation on a Bitcoin at $1 million. But history teaches us that volatile markets can reinterpret leadership until the next “undervalued gem” emerges. With strong hands accumulating Bitcoin faster than its mining, future scarcity promises to be fierce, although the question remains: can $ETH capitalize on that dissatisfaction and the appetite for higher short-term returns?