Here’s Why Interest Rates on Cryptocurrencies Could Be a Game-Changer
The growth in crypto lending platforms is giving birth to a new type of valuation metric: interest rates.
The Fed may remain intransigent about negative rates, but bitcoin may benefit from other central bankers who are keeping the option firmly on the table.
Low-interest rates have removed one of the few remaining incentives for holding a bank account, meaning digital currency could be a better alternative, argues an economics analyst.
Traders may now be able to hedge the risks they face from interest rate payment fluctuations in perpetual contracts.
Even as Fed Chair Jerome Powell says negative interest rates are not on the cards, the remaining possibility might be rekindling traders' spirits – or at least refocusing attention on bitcoin as a hedge against inflation.
Bitcoin remains steady, with its 24-hour price in the $8,600-$8,800 range.