Bitcoin

Arthur Hayes, the former CEO of BitMEX, has <a href="https://cryptotale.org/bitmex-co-founder-arthur-hayes-slams-cardano-as-dog-shit/" rel="noopener noreferrer nofollow">offered </a>a thought-provoking analysis of why recent Federal Reserve rate cuts have not boosted Bitcoin prices as expected. Hayes points to a significant shift in financial markets, which he argues explains Bitcoin&#39;s disappointing performance despite a favorable interest rate environment.In his recent commentary on X, Hayes highlights that the anticipated rate cut by the Federal Reserve, as hinted by Chair Jerome Powell’s speech at Jackson Hole, has not translated into gains for Bitcoin.Hayes attributes this paradox to the growing prominence of reverse repurchase agreements (RRPs). These financial instruments, where securities are sold with a commitment to repurchase them at a higher price in the future, currently offer an interest rate of 5.3%. This rate is significantly higher than the 4.38% yield provided by Treasury bills, traditionally seen as a safe investment.Consequently, significant money market funds have redirected their cash from Treasury bills to RRPs, resulting in a tighter market for risky assets like Bitcoin. This shift means less liquidity is available for investments in high-risk assets, including cryptocurrencies.Moreover, Hayes points out that since the Fed signaled a potential rate cut in September, an additional $120 billion has flowed into RRPs. This influx contrasts sharply with the assumption that lower interest rates would encourage more investment in high-risk assets by making safer investments less attractive. Instead, the reverse is happening: money stays in the &#34;parking lot&#34; of RRPs rather than circulating through the economy.<a href="https://cryptotale.org/former-ceo-bitmex-why-fed-rate-cuts-arent-boosting-bitcoin/" rel="noopener noreferrer nofollow">Read more on Cryptotale.</a>Visit the links for more information <a href="https://cryptotale.org/" rel="noopener noreferrer nofollow">Website</a> | <a href="https://twitter.com/cryptotalemedia" rel="noopener noreferrer nofollow">Twitter </a>| <a href="https://t.me/cryptotale_news" rel="noopener noreferrer nofollow">Telegram </a>| <a href="https://www.instagram.com/cryptotalenews/" rel="noopener noreferrer nofollow">Instagram </a>|

Former CEO BitMEX: Why Fed Rate Cuts Aren't Boosting Bitcoin

CryptoTale

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