BTC Experiences Local Volatility as FED Outlines Accommodative Policy for the Remainder of 2021
The US Federal Reserve will retain an accommodative monetary policy for the rest of the year, aiming for two rate hikes by the end of 2023. As the expected news broke, BTC/USD experienced local volatility within a 4% range.
In recent news, Michael Saylor outlined that other cryptocurrencies can thrive alongside bitcoin, and the Bitcoin Taproot upgrade is now locked in for November 2021.
Let’s dig in.
MicroStrategy CEO Michael Saylor Says Other Cryptos Can Thrive
MicroStrategy CEO Michael Saylor told CNBC that bitcoin is not alone in having a bright future in the cryptocurrency space. However, the CEO believes that the sector must be built on “a solid footing of granite” in order to thrive.
Check out the full article here!
Fed Rates to Remain Unchanged Through 2021
Bitcoin volatility is magnetic for traders who are able to capitalise off price swings in both directions. At the same time, bitcoin’s fundamental properties of absolute trust make it a desirable store of value. These properties are especially desirable in a time when faith in central bank policies wanes with each passing day.
As the bitcoin market forms a consolidating or ranging structure, all eyes were on the US Fed FOMC meeting which just took place.
In short, the Fed will maintain an accommodative stance of monetary policy for the year, while aiming to have rate two hikes fully priced in by 2023. However, this could change depending on the monthly data, as Powell noted during the question and answer period.
Per Bloomberg data, the Fed released a so-called dot plot, outlining the US central bank path of interest rates. The Committee decided to keep the target range for the federal funds rate at 0 to 0.25%.
During the press conference, Jerome Powell alluded to two things which grabbed my attention. Firstly, that the meeting was a “talking about talking about” meeting; and secondly, that the Fed “must be humble about our ability to understand the data.”
In other words, Jerome Powell does not have a crystal ball despite the fact that global market participants treat his words as if he does.
The case for bitcoin could not be stronger.
BTC Low Time Frame Volatility spikes
Meanwhile, bitcoin seemingly reacted to the Fed meeting, exchanging hands within a 4% range as information dripped into the aether.
All in all, the FED outlined an accommodative policy so any significant macro tremors are officially postponed, probably.
Bitcoin Miners Signal For Taproot In Unison
Fortunately, last week bitcoin miners signalling positively for the Taproot upgrade reached the required 90% (upwards of 99%) meaning the upgrade will take place in November 2021. The update is only a soft fork so no change is required on the behalf of users.
The last Bitcoin network upgrade happened back in 2017 with the SegWit proposal and resulted in the hard fork of Bitcoin Cash, which took with it roughly 10% of miners and users, having dramatic effects on the bitcoin price.
Relative network unity bodes well for future upgrades. You can find out more about the Taproot upgrade here.
As opposed to opaque, nebulous and ‘wait and see’ Fed policies, Bitcoin policies are predictably programmed and network upgrades fully transparent.
This tells you all you need to know about where to park your money.
Catch you next time.
Read More: MicroStrategy CEO Michael Saylor Says Other Cryptos Can Thrive
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Originally published at https://mailchi.mp.