Crypto prices rose after the Federal Reserve cut its key lending rate by 50 basis points on Wednesday.
The industry’s total market cap is up 3% today, and market leader Bitcoin has broken its $62K resistance. Will this step continue?
Fed dissolves market, Bitcoin’s rock-solid fundamentals shine through
It was a toss-up whether the market would react positively to a 50-point cut because of a potential unintended message it could send about a shaky economy.
However, the positive price action shows that traders are confident in a healthy economy, and this is helped by expectations of more rate cuts through 2025.
Additionally, the 50 basis point cut makes borrowing money cheaper, which will boost liquidity in risk-on-asset markets like crypto, providing a tailwind for growth.
Indeed, this is positive for Bitcoin – but it is not the only consideration. Another is the four-year half-life.
Every four years, the amount of Bitcoin rewarded to miners per block is cut in half, reducing the amount of new BTC entering the market.
About six months after the halving, a ‘supply shock’ is felt, in which miner reserves are depleted, and a difference between supply and demand causes the BTC price to rise.
The last halving was in March 2024, which was six months ago.
Adding to the excitement are Bitcoin ETFs. This will be the first time institutional capital has such seamless direct exposure to Bitcoin during a bull rally.
All of this converges into a fundamentally robust outlook for the market-leading cryptocurrency.
But what do the cards say?
At press time, analyst MacroCGR published a Bitcoin chart pattern showing BTC breaking out of a pennant to the upside. This could signal a shift in momentum and potentially enable his next leg, taking out his previous ATH.
As for the price target, Bluntz is looking at $85K, followed by a short consolidation and a second leg to $100K by the end of 2024.
In the first quarter of 2024, Bitcoin rose from $42K to $73K, representing a 73% increase in three months.
However, this happened at a time when interest rates were high and before the halving and ETF approvals.
Bluntz expects a 61% upside from its current price, which seems more than reasonable given the above factors.
Best Cryptos to Buy for the Next Bull Rally
Should Bitcoin perform as expected, it will also set the pace for altcoins. Let’s look at three of the best coins to buy for the expected bull run.
Toncoin
Toncoin is a layer 1 blockchain with huge adoption. Multiple applications on its network boast tens or hundreds of millions of users.
This is because Toncoin is a Telegram native blockchain. Telegram’s 900 million users can use Toncoin effortlessly without much fuss.
Toncoin’s leading project by adoption is Hamster Kombat, with over 200 million users. Others like Notcoin and Dogs have raised tens of millions.
In fact, Dogs is now the most adopted meme coin, with 17 million users claiming its recent airdrop.
These projects created a blueprint formula for mass adoption: start on Toncoin and run an airdrop.
Now teams that want a widely used project will be pushed to do the same.
This can create a network effect, leading to further ecosystem development, more robust infrastructure and a higher TON price.
In an industry full of speculation, Toncoin has already proven itself by gaining mass adoption.
Crypto All-Stars
On the other end of the spectrum, Crypto All-Stars is an up-and-coming project with all its upside ahead of it.
The project is building the first unified staking protocol for meme coins, allowing users to stake any top meme coin and generate $STARS rewards.
However, users must hold $STARS to access the platform; the more they like, the more they will earn.
They can also redeem their $STARS tokens to expand their rewards. Currently, $STARS stakes offer a 1,000% APY, but this will decrease over time.
In Q1 2024, the meme coin sector produced the largest return by far. Should we see history repeat itself, Crypto All-Stars is in a favorable position to capture a lot of liquidity.
Crypto All-Stars is undergoing a pre-sale and has raised $1.4 million so far.
Today, investors can buy $STARS for $0.0014535, but this price will rise in two days.
Ethereum
Ethereum has been an underperformer in recent months, losing ground to Bitcoin and some altcoins such as Solana.
However, that could all be about to change. For the first time, institutional capital can flow directly into ETH during a bull market via its new ETFs.
The Ethereum ETFs have seen low volume of late, but inflows are likely to increase as the bull market prevails.
Another reason why ETH could explode is that it has finally figured out how to deal with its previously exorbitant gas fees through the use of layer 2 blockchains.
There remains an active discussion about how this affects the Ethereum value, but we should not discount the fact that high gas fees have been Ethereum’s biggest concern for a long time.
Lower fees will drive more adoption, which in turn will drive more demand for ETH.
ETH has also reacted more positively than Bitcoin since the recent rate cut decision, pumping 5% in the last 24 hours.
Disclaimer for Uncirculars, with a Touch of Personality:
While we love diving into the exciting world of crypto here at Uncirculars, remember that this post, and all our content, is purely for your information and exploration. Think of it as your crypto compass, pointing you in the right direction to do your own research and make informed decisions.
No legal, tax, investment, or financial advice should be inferred from these pixels. We’re not fortune tellers or stockbrokers, just passionate crypto enthusiasts sharing our knowledge.
And just like that rollercoaster ride in your favorite DeFi protocol, past performance isn’t a guarantee of future thrills. The value of crypto assets can be as unpredictable as a moon landing, so buckle up and do your due diligence before taking the plunge.
Ultimately, any crypto adventure you embark on is yours alone. We’re just happy to be your crypto companion, cheering you on from the sidelines (and maybe sharing some snacks along the way). So research, explore, and remember, with a little knowledge and a lot of curiosity, you can navigate the crypto cosmos like a pro!
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