Rate Hike Expectations Pressure Crypto

Weekly Wrap: Rate Hike Expectations Pressure Crypto

Bitcoin (CRYPTO: $BTC) and other cryptocurrencies were down to end the trading week on Sept. 11 as the odds of an interest rate hike in the U.S. continued to rise. Futures markets now see a greater than 70% chance that the U.S. Federal Reserve raises interest rates by 25-basis points at its meeting on Sept. 16.

Markets ratcheted up their expectations for higher interest rates following a hot U.S. inflation report for August, and as crude oil hovers near $100 U.S. a barrel for the first time since May of this year. Higher interest rates are negative for risk assets such as crypto. As a result, Bitcoin was trading at $77,500 U.S. at week’s end, down from a recent high of $82,000 U.S.

Other digital assets were also under pressure, with Ethereum’s (CRYPTO: $ETH) price right around $2,500 U.S. Despite the pullback, crypto prices remain sharply higher than where they were a month ago, when Bitcoin was trading below $65,000 U.S. BTC peaked at an all-time high of $126,198.07 U.S. on Oct. 6 of last year.

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Here’s what else happened with cryptocurrencies over the past week…

Strategy Holds Off On Bitcoin Purchases:Strategy (NASDAQ: $MSTR) did not buy or sell any Bitcoin over the last week. Instead, the company focused on repurchasing 1.81 million shares of its preferred stock (NASDAQ: $STRC) for $176.3 million U.S. Strategy also increased the total allowable repurchase amount of its preferred stock to $2 billion U.S. from $1 billion U.S. The serial crypto acquirer kept its holdings of Bitcoin unchanged at 845,050 BTC.

U.S. Bancorp To Launch Stablecoin: U.S. Bancorp (NYSE: $USB), the fifth largest lender in America, is preparing to launch its own stablecoin. The bank said that it has completed a live cross-border paymentts payments business. The stablecoin is called USBDC (CRYPTO: $USBDC) and is pegged one-for-one to the U.S. dollar. The move by U.S. Bancorp comes as stablecoins tied to fiat money grow in popularity among financial institutions

Ethereum To Be ‘Quantum Resistant’ By 2029: The Ethereum Foundation (CRYPTO: $ETH) has set itself the goal of making its blockchain and related infrastructure resistant to quantum computer attacks by 2029. The move comes as a growing number of analysts predict that powerful quantum computers will be able to break today’s cryptography by 2030. The Ethereum Foundation said that it is taking the threat of quantum computers serious and has locked in 2029 as its goal to make the Ethereum blockchain resistant to such attacks.

Source: finance.yahoo.com