Bitcoin After The FED Cuts Interest Rate!

BitHodler

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Quote from: hugeblack on August 04, 2019, 01:05:46 PM

Investing in cryptocurrencies does not specifically mean BTC "if we're talking about an investment" as some of shitcoins have gone higher than expected.

Shitcoins are retail "investment" vehicles. No serious investor will buy into a shitcoin with so much slippage on both sides of the book and the risk that the "developers" or other bag holders will dump on your face.

Crypto as a whole is lacking liquidity, but Bitcoin at least offers decent enough liquidity for the relatively lower amounts investors are willing to allocate to Bitcoin. Bitcoin is the go-to asset regardless of how you look at it.

There is a reason why the majority of altcoins don't follow Bitcoin as they used to do. It was Bitcoin up 5% altcoins up 10-15%, but that currently isn't the case. Currently it's Bitcoin up 15% altcoins up 5%.

Vispilio

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A rate cut almost always means fresh injection of cash into the economic system, as everyone is now more incentivized to spend rather than

save, so the effect is all commodities & equities denominated in USD (including the BTC/USD) are expected to gain against the cut currency...

bitgolden

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Quote from: ?? on ??

Indeed Bitcoin is the best performing assets in the world so far. Since many people recognize Bitcoin as an alternative investment aside from oil, gold, etc. It only show that many had interest on putting their money in line with Bitcoin but, the risk is still there which is the high volatility even with high return. Still traditional investments are good with it's constant or stable status in the market.

There will always be volatility in any system that is yet to fully be adopted, those assets that are quite stable now like stock, Forex and the rest once has had their own low interest and volatility too, but with time, they got better and go more interest till the percentage increased from 0 to 100 percent.

The volatility of bitcoin is still quite much now because it is a system that people are still trying to get used to and as we can see that its popularity is seriously growing to the pint that it is gradually becoming more popular than all these stock and Forex assets, this is a sign that we are speedily approaching the time that its volatile would be reduced to virtually almost zero now. That point, bitcoin would be more useful as store of value and maybe qualify as digital gold.

eaLiTy

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Quote from: SuperTA on August 01, 2019, 02:21:21 PM

Bitcoin Is The Best Performing Major Asset In the world. If you look at the 6 months return, 1 year, 3 year, 5 year or 10 year return.
Bitcoin 6 month return is missing on the picture, currently 202%. There is no better major asset in the world right now!

The reason why every government around the world is trying to come up with rules and regulation in the bitcoin market is simply because it is the highest performing asset out there in the past few years and with the rally bitcoin had in 2017 there is no way any government could turn a blind eye to the emerging market and they want to have a pie of the profit or try to control the market as much as they can have a partial control over the money flowing out of the country if they come up with regulations. Bitcoin will continue to outperform every other asset class in the coming years as well and we will see institutional investments coming into the market as well.

exstasie

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Quote from: 1Referee on August 04, 2019, 02:11:18 PM

I'm pretty sure that stocks will benefit much more than Bitcoin, but not necessarily in terms of percentage gains.

Funny enough, the S&P 500 immediately dumped on the news. I guess 25 basis points was smaller than the market had hoped for? Meanwhile, Bitcoin has pumped hard ever since the rate cut, up almost 22%. Probably a coincidence given how oversold the market was, but it's gotta make you think!

1Referee

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Quote from: arpon11 on August 02, 2019, 01:48:26 PM

It has given a good return this year and that is why I think it will be in favor of bitcoin than stocks, commodities, and bonds.

I'm pretty sure that stocks will benefit much more than Bitcoin, but not necessarily in terms of percentage gains. Bitcoin goes up more because it has such a tiny market cap and next to no meaningful liquidity. It only requires a tiny bit of institutional capital to flow into Bitcoin to make it go up 5-10x.

In the end, we're not even sure if the rate cuts have anything to do with Bitcoin going up this year. It might just as easily have been coincidence because Bitcoin has pumped and dumped quite frequently without there being an actual reason to point at. People just assume there is a reason but that's just how this market is.

Harlot

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This would be connected if majority of the investors here are holding a significant amount of Bitcoin which isn't the case, still the crypto market isn't that a big of a market in terms of the number of investors they have, so even if the feds cuts or even increase interest rates you wouldn't see a big connection on how it had contributed to the price of Bitcoin. It doesn't really show any connection whatsoever, its just a mere coincidence that all the media outlets we have are taking advantage of and unfortunately they are misleading a lot of us.

hugeblack

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I do not think the global economy is growing as some governments mention, and the high risk of a war on Iran in one of the world's major energy corridors could reinforce fears of moving away from any assets related to governments and going to invest in gold (valuable assets) or cryptocurrencies.
I do not think a comparison between gold and cryptos would be valuable because this subject has been discussed at length.

Investing in cryptocurrencies does not specifically mean BTC "if we're talking about an investment" as some of shitcoins have gone higher than expected.

RealMalatesta

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Quote from: The Sceptical Chymist on August 02, 2019, 09:52:44 AM

Quote from: Linkkoin on August 02, 2019, 05:49:43 AM

Very low-interest rate is nothing else than slowly burning your money (because of the real inflation you can feel in the pocket).

You'd have to be a moron to save your money in a bank these days anyway--the interest rates were already near zero. I wasn't even aware the Fed had lowered them, and that's actually surprising news to me if it's true (I haven't verified it and really don't care to).

The thing with extremely low interest rates is that investors have to look for alternatives paying more than what a bank guarantees, and that's usually the stock market. It also makes it very easy for traders to trade on margin, with a lot of leverage--and they do. That leads to asset inflation as they keep buying stocks, bonds, crypto, whatever. The real problem is when interest rates start to rise again. That's when everyone gets spooked and markets start to tank.

Not sure how bitcoin reacts to interest rates in general, but I'd think that it'd be an inverse correlation if there even is one yet. It's still a very new asset class and I don't think there's a ton of institutional money in it...yet. Watch out when there start to be futures markets for bitcoin and other cryptos, because at that point I'm pretty sure they'll start to be very sensitive to interest rates.

Well that is their choice and there is not point to call those who are into it a moron, we have many people that still does not understand the system of crypto, so they would always keep their und in banks even if it is not going to yield profit. It is just the same way people would keep their fiat in stable coin because of the volatility of other coins. It is best to those keeping money in ban k to do so than just to wake up one day and realize that the money they kept in a particular cryptocurrency rather than yielding result had turned zero.

And even you, if I ask you to declare you bank account, I can bet you will not be bold to show it because it is not zero and you still have your own money saved there. Cryptocurrency is a gradual thing and with time, people will start adjusting to it.

arpon11

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when the news of this interest rate cutting by the fed, hit the media two days ago, Bitcoin jump from it low of $9100 to above $10,000 and since that day Bitcoin has been going up. I believe Bitcoin will be the most beneficial of this interest rate cutting as it has outperformed many assets this year. It has given a good return this year and that is why I think it will be in favor of bitcoin than stocks, commodities, and bonds.

TheCoinGrabber

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I remember reading up a thread talking about a survey showing the number of people considering buying bitcoins going up. I think it's just clear to people now that bitcoin is another investment they can put their money in in case of a crash and keep it safe there. Bitcoin's own growth is also not shabby when compared to more traditional investments like metals.

Quote from: danherbias07 on August 02, 2019, 08:20:42 AM

Bitcoin showed something differently.
Your assets are private and you can easily do it yourself.
I would rather pick that than going thru some middleman and a lot more just to say I am invested.

Totally. It's just easier. There not a large minimum required to invest.

fullhdpixel

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This is just the beginning, there is still going to be more performances and the gap will be so wise that bitcoin may be the major focus in the market and major attractive investment asset for many investors. Imagine the performance at just very little compliance, not to talk of when there is now very full compliance with the technology of bitcoin cryptocurrency, and when there is also all manner of regulations from various government bodies.

I believe those that says that it is possible for bitcoin value to increase even up to 500k because in some years to come, all focus will just be in bitcoin alone, which is why many investors should try to make future investment down now that they still can, because the moment bitcoin is getting to 50k and above, it is going to start getting too difficult to get.

The Sceptical Chymist

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Quote from: Linkkoin on August 02, 2019, 05:49:43 AM

Very low-interest rate is nothing else than slowly burning your money (because of the real inflation you can feel in the pocket).

You'd have to be a moron to save your money in a bank these days anyway--the interest rates were already near zero. I wasn't even aware the Fed had lowered them, and that's actually surprising news to me if it's true (I haven't verified it and really don't care to).

The thing with extremely low interest rates is that investors have to look for alternatives paying more than what a bank guarantees, and that's usually the stock market. It also makes it very easy for traders to trade on margin, with a lot of leverage--and they do. That leads to asset inflation as they keep buying stocks, bonds, crypto, whatever. The real problem is when interest rates start to rise again. That's when everyone gets spooked and markets start to tank.

Not sure how bitcoin reacts to interest rates in general, but I'd think that it'd be an inverse correlation if there even is one yet. It's still a very new asset class and I don't think there's a ton of institutional money in it...yet. Watch out when there start to be futures markets for bitcoin and other cryptos, because at that point I'm pretty sure they'll start to be very sensitive to interest rates.

danherbias07

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There is just not so much drama with bitcoin.

Investing in mutual funds and bonds needs a lot more effort. Yes they have managers and brokers but yet it is still a gamble.

Bitcoin showed something differently.
Your assets are private and you can easily do it yourself.
I would rather pick that than going thru some middleman and a lot more just to say I am invested.

Linkkoin

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Quote from: alphaboon on August 01, 2019, 08:15:25 PM

Lower interest means less earning through saving on the conventional banks. I feel that this gives more liquidity for us in the bitcoin market. A Plus for bitcoin

Very low-interest rate is nothing else than slowly burning your money (because of the real inflation you can feel in the pocket). If you are to burn the money anyway, you can always look for alternatives which might be riskier, but giving you more profit. Bitcoin is the very best example of that.

alphaboon

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Lower interest means less earning through saving on the conventional banks. I feel that this gives more liquidity for us in the bitcoin market. A Plus for bitcoin

jackg

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Generally in financial crises people start to pull out of investments in order to fund other things.

I'm not sure if everything falling means bitcoin may rise by staying stagnant against other currencies, maybe that will be the case, certainly some alts might do quite well (particularly medium capped ones like dash and ltc) as I see low value altcoins being axed much less than bitcoin if bitcoin starts to drop (but that's just my opinion). We may see a load of people new to the space trying to quicly get into bitcoin also (and they might mistakingly go to bitcoin.com and buy the bad coin)...

Being 2019 now we seem to be overdue another crash, the last two were 7 years apart which means we're either becoming more stable (again) or easier to fool...

SuperTA

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https://twitter.com/BitKrabs/status/1156516105734840320

Bitcoin Is The Best Performing Major Asset In the world. If you look at the 6 months return, 1 year, 3 year, 5 year or 10 year return.
Bitcoin 6 month return is missing on the picture, currently 202%. There is no better major asset in the world right now! This becomes even more interesting because the fed cuts interest rates right now.

The history shows you, when the fed cuts interest rates in similar circumstances, it's a matter of months before the financial crisis starts to show up. Investors will seek for the safe haven. Some investment is expected to go into bitcoin. Because bitcoin is a low marketcap compared to gold, it will probably rise more.

Don't forget that bitcoin was born like a phoenix from the ashes of the financial crisis in 2008-2009! The financial crises are actually good for the bitcoin. When the big stock players see that everything is falling except bitcoin and maybe gold, guess what...they will probably invest some in bitcoin. Bitcoin is outperforming gold so it is no-brainer to me.

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