Customise Consent Preferences

We use cookies to help you navigate efficiently and perform certain functions. You will find detailed information about all cookies under each consent category below.

The cookies that are categorised as "Necessary" are stored on your browser as they are essential for enabling the basic functionalities of the site. ... 

Always Active

Necessary cookies are required to enable the basic features of this site, such as providing secure log-in or adjusting your consent preferences. These cookies do not store any personally identifiable data.

No cookies to display.

Functional cookies help perform certain functionalities like sharing the content of the website on social media platforms, collecting feedback, and other third-party features.

No cookies to display.

Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics such as the number of visitors, bounce rate, traffic source, etc.

No cookies to display.

Performance cookies are used to understand and analyse the key performance indexes of the website which helps in delivering a better user experience for the visitors.

No cookies to display.

Advertisement cookies are used to provide visitors with customised advertisements based on the pages you visited previously and to analyse the effectiveness of the ad campaigns.

No cookies to display.

Arthur Hayes explained why the Federal Reserve’s rate cuts might not have a significant impact on the price of BTC

be40972e584d4a41b87014baba1bbbb8.jpeg

The main reason lies in the widening spread between repo operations and the yield on Treasury bonds, which currently offer 5.3% and 4.3%, respectively. This gap makes reverse repo transactions more attractive to large funds.

As a result, investors are withdrawing funds from Treasury bonds and moving them into reverse repo transactions, which, according to Hayes, reduces the amount of liquidity available for investments in risky assets like cryptocurrencies. In an environment of limited money supply, there are fewer resources available to support the growth of Bitcoin and other digital assets.

Since mid-August, $120 billion has been converted in this manner, leading to a 10% drop in Bitcoin’s price following Federal Reserve Chairman Jerome Powell’s speech on August 23. Although Bitcoin partially recovered the next day, there is still uncertainty in the market regarding the future price dynamics. This situation illustrates that the impact of the Federal Reserve’s decisions on the cryptocurrency market may be limited, especially when large institutional players prefer more stable financial instruments.