CoinShares and Greekslive noted that the Fed's decisions and the holding of Token2049 had a major impact on the resurgence of investment in Bitcoin and other cryptocurrencies.
The recent decision by the US Federal Reserve (Fed) to cut interest rates by 50 basis points has had a positive effect on the cryptocurrency market.
According to separate reports from CoinShares and Greekslive, the move by the Fed has boosted investor confidence, directly impacting investments in digital assets, especially Bitcoin. According to CoinShares' latest weekly report, crypto-asset-based investment products experienced a a capital inflow totaling $321 million in the last week, with Bitcoin being the main recipient of this capital, with $284 million dollars.
On the other hand, the recently held Token2049 event has also had an influence on the current positive market perception, albeit with a more moderate impact, according to Greekslive. The platform highlighted that, despite the fact that no major announcements were made, the holding of this event has kept the spotlight on the crypto ecosystem and has contributed to restoring confidence among cryptocurrency investors.
Crypto market grows after Fed decision
The Fed's interest rate cut has created a favorable environment for cryptocurrency investment, with Bitcoin leading the way.
According to CoinShares, the Fed's decision has been interpreted as a move towards a more flexible monetary policy, which in turn has led to an increase in liquidity in the crypto market. This increase in liquidity has allowed investors to consider Bitcoin as an attractive alternative to traditional assets.
In its weekly report, the firm indicated that, following the Fed's decision, Total assets under management in cryptocurrency investment products grew by 9%, reaching a volume of $9.500 billion. This growth reflects not only an increase in investment in Bitcoin, but also a renewed interest in other cryptocurrencies and digital assets such as Solana, although Ethereum remains an outlier, facing capital outflows for five consecutive weeks, as indicated by the firm.
Source: coinshares
On the other hand, geographically, CoinShares highlighted that EThe United States continues to lead capital inflows into crypto-asset funds and investment products, with $277 million in the last week. Next in line was Switzerland, which saw $63 million in inflows into digital asset products, and Brazil, with $1,4 million. CoinShares stressed that this outlook suggests that investors, mainly from the US, are looking to diversify their portfolios, taking advantage of the opportunity presented by the cryptocurrency market at a time of lower interest rates.
The impact of Token2049 on market confidence
Although the Token2049 event did not generate any disruptive announcements, according to Greekslive, it served as a meeting point for industry leaders and cryptocurrency enthusiasts.
Platform stressed that while the market reaction to Token2049 was relatively lukewarm, its mere celebration shows that Interest in the cryptocurrency sector remains alive. He indicated that interaction and exchange of ideas in such events are crucial to maintaining the unity and morale of the market. The platform also indicated that the Changpeng Zhao's release, who is set to be released from prison on September 29, could also influence the confidence and recovery of cryptocurrencies, and add a new level of dynamism to the crypto market.
In addition to the events noted above, this week is expected to be crucial for the crypto market, with several important events scheduled, including several speeches by Fed governors and the release of key economic indicators in the United States. According to Greekslive, these events could influence the direction of the market and investor confidence in the near future.
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