Bit Market Weekly | Interest rate cut expectations are thwarted, and U.S. politics supports digital assets

Investors experienced a roller-coaster ride in May in rate cut expectations. At the beginning of the month, under the dual influence of Powell's dovish speech and the sluggish employment report, the market's expectations for an interest rate cut suddenly increased. However, today, market participants have quietly postponed the expected time of interest rate cut from September to November, and reduced the number of interest rate cuts during the year to one.

Last week, Federal Reserve officials made successive hawkish speeches, and the minutes of the meeting questioned whether current interest rates can effectively curb inflation. The U.S. dollar index fell back on Friday but maintained its rebound throughout the week, recording its strongest weekly gain in a month and a half. In terms of U.S. stocks, the trends of major indexes were divergent: the S&P 500 index rose slightly by 0.03%, the Nasdaq Composite Index and the Nasdaq 100 Index both posted weekly gains of 1.41%, both achieving five consecutive weeks of gains; while the Dow Jones Industrial Average fell by 2.33%. , recording the most significant weekly decline since March last year. At the same time, cryptocurrency-related stocks generally strengthened, with representative stocks such as Coinbase and MicroStrategy as well as mining stocks collectively rising.

Ethereum ETF approval expectations have ushered in a dramatic reversal. In the early hours of last Tuesday, Eric, a senior ETF analyst at Bloomberg, tweeted that he would increase the probability of ETF approval from 25% to 75%. After the tweet, Ethereum rose by 20% in a single day. He said that politics factors have become the key reasons for the shift in ETF approval. Several bipartisan lawmakers have urged the SEC to approve ETFs for Ethereum and other currencies, as this would provide investors with regulated, transparent and safe exposure to cryptocurrencies. On Friday, the SEC approved the Ethereum ETF 19-4 document. There are still S1 documents that need to be reviewed and approved. The final approval is basically a foregone conclusion.

Trump spoke at the Libertarian Party National Convention in Washington, D.C., "If he is re-elected, he will ensure that the future of digital assets and Bitcoin happens in the United States, rather than being expelled overseas, and will support 50 million digital asset holders in the United States." “It will never allow the creation of a CBDC, and keep anti-digital assets away from Bitcoin.”#MarketWeekly#EncryptionAssets#BTC#ETH#Trumphttps://wolai.com/oz26aeGTPpkdhu