The Breakdown: What Does The Fed’s 0% Rate Cut Say About Bitcoin?
Yesterday the Federal Reserve took drastic measures intended to keep the economy afloat, slashing the Fed funds rate, its primary interest rate to nearly 0% in what would be the second emergency cut in less than a week, and the first set of emergency cuts since 9/11, along with a number of other accommodative measures. We’ve seen huge fluctuations in markets across the board, and stock trading in New York was briefly halted this morning after prices plummeted. Bitcoin also fell past $4,500 this morning, which was 16% in a single day. Last Thursday it had plummeted 31%. People are comparing this event to the 2008 financial crisis, but there are plenty of differences. The bottom line is that there seem to be fears of liquidity drying up. NLW discusses with Noelle Acheson, research director at CoinDesk, and chief content officer Michael Casey on what this move means for the markets and how people are seeing bitcoin as part of the broader financial system.