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<p class="is-style-lead">Wharton professor Jeremy Siegel called for the Federal Reserve to deploy an emergency rate cut as liquidity fled cryptocurrencies and global markets on recession fears.</p>
<p>Cryptocurrency markets dropped over $300 billion in 24 hours as assets like Bitcoin (<a href="https://crypto.news/price/bitcoin/" target="_blank" rel="noopener noreferrer nofollow">BTC</a>) and Ethereum (<a href="https://crypto.news/price/ethereum/" target="_blank" rel="noopener noreferrer nofollow">ETH</a>) slid double-digits alongside traditional markets like the S&amp;P 500 and the Nasdaq. The U.S. stock market also extended losses on recession fears, losing $1.93 trillion when trading opened on Monday, August 5.</p>
<p>Wharton’s Siegel <a href="https://x.com/SquawkCNBC/status/1820420112895074315" target="_blank" rel="noopener noreferrer nofollow">urged</a> the U.S. Federal Reserve to implement a 75-basis-point emergency interest rate cut to stem a global liquidity crunch.</p>
<p>In theory, Siegel’s proposed Fed pivot could provide much-needed relief for American financial markets. Extra liquidity on Wall Street could find its way into crypto markets, steadying prices and cushioning embattled digital asset valuations.</p>
<p>Institutional vehicles are already showing an appetite for crypto-backed funds. Spot Bitcoin exchange-traded funds saw $1.3 billion worth of trading volume in the opening 20 minutes of trading. While ETF data is typically staggered, spot BTC ETF investors may buy the dip, and inflows turn out positive.</p>
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   <p lang="en" dir="ltr">20 mins into the trading session and <a href="https://twitter.com/hashtag/bitcoin?src=hash&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">#bitcoin</a> ETFs have already seen $1.3bn in volume — this is extremely elevated <a href="https://t.co/D6ZQEHtfdY" target="_blank" rel="noopener noreferrer nofollow">pic.twitter.com/D6ZQEHtfdY</a></p>— Alex Thorn (@intangiblecoins) <a href="https://twitter.com/intangiblecoins/status/1820456747653324987?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">August 5, 2024</a>
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<p>You might also like: <a href="https://crypto.news/the-bullish-case-for-crypto-polymarket-forecasts-and-sahm-rule/" rel="noopener noreferrer nofollow"> The bullish case for crypto? Polymarket forecasts and Sahm Rule </a></p>
<h2 class="wp-block-heading" id="polymarket-users-pile-3-3m-on-fed-cut-bets">Polymarket users pile $3.3m on Fed cut bets</h2>
<p>Meanwhile, bettors on the Polygon-based decentralized prediction market, Polymarket, have placed $3.3 million on wagers about Fed interest cuts this year.</p>
<p>The second-largest punter pick expects three 75 bps cuts between August and December. The Federal Open Market Committee calendar shows meetings in September and November, respectively, with markets pricing in a rate cut next month.</p>
<p>Three cuts before 2024 ends would require the Fed to announce an emergency policy switch amid global market downturns. However, it was unclear if the American apex bank would adopt such an aggressive pivot or how crypto markets would react to the fund rate change.&nbsp;</p>
<p>Before global recession concerns gripped markets last week, crypto proponents generally perceived a rate cut as a positive development.</p>
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   <p lang="en" dir="ltr">FED EMERGENCY RATE CUT IN 2024?<br><br>Traders on polymarket are predicting a 55% chance that the FED will need to start cutting rates&nbsp;aggressively!<a href="https://t.co/Oc2pWGUhvV" target="_blank" rel="noopener noreferrer nofollow">https://t.co/Oc2pWGUhvV</a> <a href="https://t.co/hSTt0dHnfR" target="_blank" rel="noopener noreferrer nofollow">pic.twitter.com/hSTt0dHnfR</a></p>— *Walter Bloomberg (@DeItaone) <a href="https://twitter.com/DeItaone/status/1820440417080401973?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">August 5, 2024</a>
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<p>Read more: <a href="https://crypto.news/bitcoin-slumps-under-50k-losing-12-as-broader-financial-markets-in-turmoil/" rel="noopener noreferrer nofollow"> Bitcoin slumps under $50K, losing 12% as broader financial markets in turmoil </a></p>

Wharton professor Siegel urges 75bps rate cut as crypto plunges

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