Crypto Markets Outlook: FOMC, ETFs, and Bitcoin's Future
Listen to the full discussion on "Markets Daily" podcast here.
Market Movers: FOMC and Bitcoin ETFs
This episode of "Markets Daily" features Bitwise Crypto Research Analyst Ryan Rasmussen, who discusses key factors shaping the crypto landscape. The focus is on the Federal Open Market Committee (FOMC) meeting's potential influence, the ongoing impact of Bitcoin ETF approvals, and the broader crypto ecosystem's performance.
FOMC Meeting Impact
Rasmussen anticipates a flat FOMC meeting, with potential rate cuts later in the year. He explains that maintaining current interest rates could see crypto prices holding steady (Bitcoin around $40,000), while a rate hike could trigger a sell-off due to investors seeking higher yields in less risky assets. Conversely, rate decreases might encourage investment in riskier assets like crypto.
Bitcoin's Path to $80,000
Rasmussen reaffirms Bitwise's prediction of Bitcoin reaching $80,000 or more. He attributes this to several catalysts: the recent Bitcoin ETF approvals (resulting in over $5 billion in inflows), the upcoming halving, and the potential for future interest rate reductions.
Bitwise Q4 Report Highlights
The discussion also delves into Bitwise's Q4 report, highlighting the performance of the Bitwise 10 and large-cap crypto index. Beyond Solana, Rasmussen points out Ethereum and Cosmos as promising layer-1 projects. He notes the significance of Ethereum's upcoming EIP 4844 upgrade and the growth of Cosmos's app chains, particularly Injective.
Layer 2 Ecosystems
Rasmussen identifies Polygon as a leading layer-2 solution, emphasizing its strong user base and partnerships. However, he also highlights the emergence of Base (Coinbase's layer-2) and zkSync as noteworthy competitors. Ethereum continues to dominate the layer-1 landscape in terms of users, developers, and transactions.
Crypto Equities: Coinbase and Miners
Rasmussen reiterates Bitwise's prediction of Coinbase revenue doubling in 2024, exceeding Wall Street expectations by at least 10%. This is primarily attributed to the launch of Base, increased trading volume in a potential bull market, and Coinbase's role as custodian for numerous Bitcoin ETFs.
He also spotlights Bitcoin miners as an attractive investment, emphasizing the importance of low mining costs and operational efficiency in the face of the upcoming halving. Factors like increased network usage (through applications like Ordinals) could also positively impact miner revenue.
NFT Predictions
Finally, the conversation touches upon Rasmussen's prediction of a Taylor Swift NFT launch, noting the potential for increased NFT market interest if it occurs. The potential use cases for NFTs in areas like ticketing, music, and brand building are also discussed.
This episode was hosted by Jennifer Sanasie. “Markets Daily” is executive produced by Jared Schwartz and produced and edited by Eleanor Pahl, alongside Senior Booking Producer Melissa Montañez. All original music by Doc Blust and Colin Mealey.