The cryptocurrency landscape is about to witness dramatic changes. The changes can have widespread repercussions on the global financial order and boost the growth of cryptocurrencies. The political changes in the US are also driving the shifts in the attitudes towards cryptocurrencies. For example, in a survey conducted by Motley Fool around 50% of respondents expect positive crypto market performance in 2025. Nearly 48% of respondents want to invest in crypto because its value is growing and at one point it surged above $100,000. The US Federal Reserve, therefore, seems to capitalize on this opportunity. It will keep the interest rates stable and lower the interest rate in the last three quarters.
Likely Impact on The Cryptocurrency Landscape
The possible implications of the US Federal Reserve’s decision can have a wide-ranging impact on multiple sectors. It can lead to mass adoption of affordable white-label cryptocurrency exchanges and can improve leverage brokers in a marketplace. Moreover, there is a high chance that earning money from home or starting a business with no money can also become much easier. The other impacts can be described as follows.
Market Movements
The US Federal Reserve announcements may stabilize the cryptocurrency landscape. Bitcoin can witness declines and fall to around $100,000. However, these fluctuations are normal and depict the extreme sensitivity of the market. It also highlights how much policy determinations and macroeconomic situations affect the landscape.
Strategies of Investors
Portfolio diversity will increase more to ensure that the entire investment amount does not yield losses. The decision of the US Fed may help reduce uncertainty and therefore, investors must remain aware of policy news. Therefore, crypto investors should listen to the official communications from the Federal Reserve and observe the happenings of the crypto market. It will help them in making an informed decision.
Policy Level Changes
The financial markets will shape the Federal Reserve’s rate choices and cryptocurrencies. Risk-averse investors have a choice between keeping or changing the current rate which will keep an impact on the investors’ behavior. However, conventional crypto investors will use older techniques to gain maximum yields from investment.
Also Read: Bitcoin Breaks $105,000 After Fed’s Rate Decision
How Does the Trump-Musk Combo Affect the Fed Reserve?
Donald Trump as the US President will continue to influence the Fed Reserve and the Fed will likely comply with his policies. This is because there is no point in opposing the decision of the President and wasting time in lawsuits. Public sentiment towards cryptos is becoming more and more favorable because of Donald Trump and Elon Musk’s open advocacy. This is the reason around 50% of respondents expect that the cryptocurrency market will perform positively. People who never invested in Bitcoin or any altcoins are now willing to invest. Therefore, it is highly likely that the Fed Reserve will frame policies and devise interest rates to cater to the growing favorable sentiment.
Final Thoughts
The US Federal Reserve is more likely to play a positive role in the cryptocurrency landscape today. Although cryptocurrencies are decentralized and do not require any intervention from the Federal Reserve. It is nevertheless pragmatic on the part of the US Fed to play a supportive role instead of playing a restrictive role. The public sentiment is currently highly favorable for Bitcoins and other altcoins. This could be a reason that the Fed does not want to discourage people from investing in cryptocurrencies. However, it is also reasonable to believe that the mainstreaming of cryptos can have an enormous impact on the functions and relevance of the US Federal Reserve.
