Markets
Cryptocurrency Markets Rebound as Fed Chairman Warns Against Prolonged High Interest Rates
Digital assets continue to recover after the weekend’s sharp sell-off.
Cryptocurrency markets continued to rally on Wednesday morning after Federal Reserve Chairman Jerome Powell warned that maintaining high interest rates for an extended period could pose risks to the U.S. economy.
“Reducing policy restraint too late or too little could unduly weaken economic activity and employment,” Powell he said during its semi-annual monetary policy update. “More good data would strengthen our confidence that inflation is moving sustainably towards 2%.”
Powell’s comments suggest the U.S. Federal Reserve may soon consider cutting interest rates if current economic trends continue.
The cryptocurrency market responded favorably, with the combined market value of digital assets rising 1% in the past 24 hours, according to CoinGecko.
Bitcoin (BTC) was up 2% and traded above $58,000, while Ethereum (ETH) rose 1% and surpassed $3,100.
Stacks (STX) was the best-performing cryptocurrency among the top 100 by market cap, with a daily gain of 9%, followed by Sei (SEI) at 7.5% and Floki (FLOKI) at 7.1%.
LayerZero’s ZRO token has been rallying steadily over the past two weeks, posting a biweekly gain of 65% to trade 3% below its all-time high of $4.57. Celestia’s (TIA) token is also the best-performing top 100 token over the past seven days, with a gain of 25%.
Polka dot (POINT) also gained 0.5% in 24 hours to hold above $6, while Solana (SUN) recovered by 1.7% and was last traded at $139.5.
Asset Issuers Register Solana ETFs
Solana price rise continues Van Eck and 21Shares filed applications with the U.S. Securities and Exchange Commission (SEC) for spot Solana exchange-traded funds (ETFs) two weeks ago.
On July 8, the Chicago Board Options Exchange (CBOE) submitted 19b-4 filings to the SEC requesting approval to list these products. The SEC will have 240 days to issue a ruling on the prospective funds once the regulator formally acknowledges the filings.
Eric Balchunas, senior ETF analyst at Bloomberg, argued that the fate of these ETFs could depend on the outcome of the US presidential election in November.
“It looks like Solana ETFs will have a mid-March 2025 deadline,” he tweeted. “Between now and then, the most important thing[ortant] the date is in November. If Biden wins, these likely [dead on arrival]. If Trump wins, anything [is] Possessed[ible].”
Traditional markets
U.S. stock futures were relatively flat on Wednesday. Futures tied to the Dow Jones Industrial Average rose 0.02%, while futures for the S&P 500 and Nasdaq-100 gained 0.1% and 0.3%, respectively.
Investors await the release of the June consumer price index on Thursday, followed by the producer price index on Friday.