Bitcoin and other altcoins held steady in the past few days as some investors buy the dip and as hopes of a Fed intervention rise. BTC remained above the key support level at $84,000 and has outperformed other risky assets like the Nasdaq 100 and S&P 500 this year.
Altcoins Like Kaspa, Onyxcoin, and Pepe Have Rallied
Altcoins like Kaspa, Onyxcoin, Pepe, and Fartcoin have also done well in the past few weeks. The Kaspa price has soared by over 50% from its lowest point this year, while Onyxcoin (XCN) has jumped by 163% from its lowest point this year.
Pepe coin price has soared by 29%, while Fartcoin has jumped by over 300% from the lowest point this year. Other top-performing altcoins were Raydium, Monero, Algorand, and Decentraland.
One catalyst driving the ongoing surge of altcoins like Kaspa, Onyxcoin, and Pepe is the rising hope that the Federal Reserve will cut interest rates and boost liquidity in the market.
READ MORE: Onyxcoin Price Goes Parabolix: Can XCN Sustain the Rally?
Fed Officials Confirm Potential Bailout
Several Fed officials have confirmed this view. In a Monday statement, a Fed governor, Christopher Waller, supported more interest rate cuts if the economy weakens further than expected. He said:
“If the slowdown is significant and even threatens a recession, then I would expect to favour cutting the . . . policy rate sooner, and to a greater extent than I had previously thought.”
Other Fed officials have signaled that they will be open to cutting interest rates further if the economy moves into a recession. In a note, Susan Collins, another Fed governor, reiterated that the bank was ready to deploy various tools if the economy spiraled. She said:
“We have had to deploy quite quickly, various tools. We would absolutely be prepared to do that as needed.”
The odds of a Fed intervention have jumped as many analysts have boosted their recession odds recently. Analysts at JPMorgan have pushed their recession odds to 65%, while those at Blackrock believe that some sectors are already in a recession.
Fed interventions will likely boost the prices of top altcoins like Kaspa, Onyxcoin, and Pepe by lowering the cost of borrowing. Historically, risky assets like altcoins and stocks do well when the Fed intervenes in times of a Black Swan event. These assets surged after the Fed cut rates during the Covid-19 pandemic and the Global Financial Crisis.
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