Wall Street analysts are eyeing a potential turning point in Federal Reserve policy, with some predicting a seismic shift that could ignite a multi-trillion-dollar surge in the cryptocurrency market.
This bullish outlook hinges on the Fed successfully taming inflation, potentially unleashing an estimated $6 trillion in sidelined capital back into the market, according to a recent Forbes report. Some of that capital could move into the cryptocurrency space and boost assets like BTC, ETH, and XRP.
Tom Lee, managing partner at Fundstrat Global Advisors, has revealed he envisions a transformative event, a once-in-a-generation opportunity as if the Fed signals victory over inflation, Lee suggests trillions of dollars could flood back into the market within months.
Lee’s optimism rests on recent signs of progress. The April Consumer Price Index (CPI) showed a deceleration, rising 0.3% compared to 0.4% in March, which suggests the Fed’s aggressive monetary policy may be paying off.
CNBC reports the April CPI rose by 0.3%, below the expected 0.4%, indicating a slight easing of inflation. Year-over-year, the CPI increased by 3.4%, meeting expectations and underscoring persistent inflation.
— CryptoGlobe (@CryptoGlobeInfo) May 15, 2024
Should the Fed pivot, Lee believes a frenzy of investment activity could erupt and the price of Bitcoin could potentially skyrocket to $150,000, more than double its current price of around $71,000. Historically, other major cryptocurrencies like XRP have followed similar trajectories.
Earlier this week, the price of Ethereum soared more than 20% in a single day as the cryptocurrency market added over $200 billion, in a surge triggered by news elated to the potential approval of spot Ether exchange-traded funds (ETFs) in the U.S.
These came after the Securities and Exchange Commission (SEC) abruptly requested that the exchanges that want to list and trade these funds update key filings related to these products, fueling speculation that the regulator is considering approving these products.
A major cryptocurrency analysts are eyeing is XRP, which has struggled to regain its former highs after its legal battle with the Securities and Exchange Commission (SEC) started. The cryptocurrency could be a beneficiary from the potential $6 trillion in capital that could flow into the cryptocurrency space.
Featured image via Pixabay.