Federal Reserve Financial News

revamp to help thaw out the market’s more than two-months-long crypto winter.The DeFi sector, where investors earn yields by trading and staking cryptocurrencies without centralized intermediaries, has declined sharply following the collapse of the TerraUSD stablecoin, and as soaring inflation puts the Federal Reserve on a path of monetary tightening. The Ethereum “Merge,” one of the most significant technical upgrades to the blockchain since its inception in 2015, may be one of the few catalysts that could give DeFi a much-needed lift. Despite multiple delays, core developers have made major progress and Ethereum co-founder Vitalik Buterin has said the upgrade is set to take place in August. The Merge will shift the Ethereum blockchain from a proof-of-work consensus mechanism, where miners use powerful computers to order and validate transactions for users, to proof-of-stake. The new mechanism replaces miners with Ether holders performing the same tasks. The Merge will be the most important event in the crypto space this year by far, said Vance Spencer, co-founder of venture capital firm Framework Ventures. “If you think about how crypto markets usually move, the biggest event is usually Bitcoin halving, cutting supply of Bitcoin in half,” he said. “Here, we have the supply of Ethereum getting cut by 90% in one moment.”

Bitcoin (BTC) is bouncing back this week as a sudden surge challenges weekly highs.

The US Federal Reserve (Fed) has “limited firepower” to raise interest rates due to high oil prices and a threat of recession -- and this could lead to higher bitcoin (BTC) prices, the crypto research and investment firm CoinShares has said. Meanwhile, others also remain positive for the long-term, saying bitcoin’s network effects make it likely to succeed.

The cryptocurrency market settled into a holding pattern on May 25 after traders opted to sit on the sidelines ahead of the midday Federal Open Market Committee (FOMC) meeting where the Federal Reserve signaled that it intends to continue on its path of raising interest rates. According to data from Alternative.me, the Fear and Greed Index seeing its longest run of extreme fear since the market crash in Mach 2020.

Inflation expectations in Europe have consistently drifted upwards, and despite rising nominal interest rates, the real rate is likely to be “nothing or next to nothing,” according to Klaas Knot, President of the Central Bank of the Netherlands. Meanwhile, a professor said that 3% is a more appropriate inflation target than the 2% that is common today.

As economic conditions continue to worsen, financial experts worldwide are increasingly placing the blame at the feet of the Federal Reserve after the central bank was slow to respond to rising inflation early on.

The purported benefits of a central bank digital currency (CBDC) in the United States are “uncertain and unlikely to be realized,” and there is no compelling case for it, the American Bankers Association (ABA) has said in a letter to the US Federal Reserve (Fed). The letter also warned that a CBDC could undermine the banks’ business model.

Michael Barr, a law professor and former advisory board member of Ripple Labs who is United States President Joe Biden’s pick for vice chair for supervision at the Federal Reserve, called for U.S. lawmakers to regulate stablecoins in an effort to address “financial stability risks.”

Ether (ETH) price has been trying to establish an ascending channel since the May 12 market-wide crash that sent its price to $1,790. Currently, the altcoin’s support stands at $2,000, but the high correlation to traditional markets is causing traders to be highly skeptical s cryptocurrency market recovery. 

Bitcoin (BTC) circled $30,000 on May 18 after fresh comments from the United States Federal Reserve sparked n volatility.

The United States Senate has confirmed the nomination of Jerome Powell as the chair of the board of governors of the Federal Reserve System until 2026.

Investors were surprised by Bitcoin (BTC) price falling to $25,500 on May 12, and this shock extended to options traders. The strong correction was not restricted to cryptocurrencies and some large-cap stocks faced 25% or heavier weekly losses in the same period.

ApeCoin (APE) has undergone a sharp recovery after falling to its lowest level in two months. But its strong correlation with Bitcoin (BTC) and U.S. equities amid macro risks suggests more losses could be in store.

The United States Federal Reserve Board released its semiannual Financial Stability Report on Monday. The report points to volatility on commodities markets brought on by the Russian invasion of Ukraine, the spread of the Omicron variant of Covid and “higher and more persistent than expected” inflation as sources of instability.

Polygon (MATIC) price reversed course to the upside on May 10 after testing $0.794 as its interim support, thus rising by up to 25% to $0.99.

Alex Domash, Research Fellow, Harvard Kennedy School, and Lawrence H. Summers, Charles W. Eliot University Professor, Harvard Kennedy School._____ 

Bitcoin’s (BTC) current 20% drop over the past four days has put the price at its lowest level in nine months and while these movements might seem extraordinary, quite a number of large listed companies and commodities faced a similar correction. For example, natural gas futures corrected 15.5% in 4 days and nickel futures traded down 8% on May 9.

Wall Street’s slow embrace of crypto means we all have to start watching the Federal Reserve again. Cointelegraph parsed through the latest Federal Open Market Committee (FOMC) policy statement on Wednesday to try and uncover some nuggets of useful information. You can think of it as an exercise in financial esoterics to uncover the hidden meaning behind the Fed’s decision-making. As it turns out, the decision to raise interest rates by 50 basis points was already expected, so the actual FOMC document provided very little new information. But, Fed Chair Jerome Powell sparked a late rally in crypto and stocks on Wednesday when he said 75 basis-point increases aren’t on the table.

Bitcoin (BTC) fell further on the May 6 Wall Street open amid a warning that the U.S. equities sell-off was "not over."

Bitcoin (BTC) and other major cryptoassets fell sharply over the past day, as stock markets around the world reversed earlier gains to losses after the US Federal Reserve (Fed) raised rates by 50 basis points. The sharp fall came despite massive bitcoin buying by Luna Foundation Guard (LFG).

Bitcoin dropped the most in almost a month as the optimism seen across financial markets following the Federal Reserve's meeting on Wednesday faded. The largest digital currency fell as much as 8% to $36,639, the biggest intraday drop since April 11. It had gained 5.3% on Wednesday. Ether slumped as much as 7.2%. Avalanche and Solana, among some of the largest gainers after the US central bank raised rates Wednesday, were down as much as 11% and 7.3%, respectively. «The market still needs to digest the impact of tighter monetary policy on all risk assets and crypto might take a hit as correlations» with U.S. stocks increase, said Josh Lim, head of derivatives of New York-based brokerage Genesis Global Trading.