Crypto Markets Hold Steady Amid Fed Meeting Anticipation and Macro Updates
Bitcoin trades in a narrow range between $90,000 and $95,000, recently holding near $90,495. Over the past 24 hours, the CoinDesk 20 and 80 indexes have each declined by more than 2%, while ZEC leads gains with an increase exceeding 3%. Despite the stable price, spot market selling pressure continues with spot cumulative volume delta falling from -$40 million to -$111 million.
Markets are closely watching the Federal Open Market Committee (FOMC) meeting, which started today and will conclude tomorrow. A 25 basis point rate cut is currently priced in, though there remains the possibility of hawkish guidance. According to CF Benchmarks, Fed funds futures anticipate this cut on Wednesday and do not expect additional cuts until June, unless the labor market weakens and inflation stabilizes between 2% and 3%. Traders, as noted by Dick Lo, founder of TDX Strategies, prefer to defer upside exposure until after the meeting, with market flow expected to increase later in the week.
On the macroeconomic front, the 10-year U.S. Treasury yield has reached three-month highs. The Japanese yen has weakened amid expectations that the Bank of Japan may raise interest rates. Additionally, Mexico's November inflation data is due, with headline year-over-year inflation at 3.69% and month-over-month at 0.56%, and core inflation at 4.34% year-over-year and 0.10% month-over-month. Other economic reports including the ADP Employment Change and JOLTS releases are also anticipated.
In the crypto technology space, Ethereum founder Vitalik Buterin has proposed improvements to make transactions more predictable and to establish a trustless on-chain gas futures market. KuCoin announced the release of a Post-Quantum Cryptography Gateway proof-of-concept aimed at testing quantum-resistant cryptographic algorithms. Separately, Twenty One Capital commenced trading on the New York Stock Exchange under the ticker XXI following a business combination with Cantor Equity Partners.
