All things being equal, easier Fed monetary policy tends to lead to a weaker U.S. dollar, falling bond yields, rising precious metals prices and gains for risk assets, bitcoin BTC$89,553.48 and crypto among them.
Following the Fed’s rate cut yesterday, the dollar is indeed weaker — the DXY falling to a seven-week low — precious metals are sharply higher, with silver touching a new record of $64 per ounce, and the 10-year Treasury yield has pulled back to 4.12% from 4.20%.
In what’s become a familiar story, though, crypto is not participating. After (very) briefly rallying above $94,000 in the minutes following the rate cut, bitcoin BTC$89,553.48 has slumped to $89,400, now down 3% over the past 24 hours. Ether ETH$3,169.68 is down 5.5%, while XRP and solana slide closer to 4%.
Possibly souring the mood in crypto are declining AI-related names following Oracle’s (ORCL) disappointing quarterly earnings released last night. Oracle has plunged 14% on Thursday, pulling down familiar names like Nvidia, AMD and Broadcom. The Nasdaq is lower by 1.2%.
Bitcoin mining stocks — many of whom have pivoted business models to focus instead on AI infrastructure — are lower alongside: Hut 8 (HUT), Iren (IREN), Cipher (CIFR) and Riot Platforms (RIOT) are among those with losses in the 5%-6% range.
Leading bitcoin treasury player Strategy (MSTR) is off by 6.4%, while crypto exchange Coinbase (COIN) is down 5%. Robinhood (HOOD) is lower by 8.3% after a November update showed a disappointing slump in crypto trading volumes.