Why is the crypto market going up today? (Sep. 18)
The crypto market is going up today, Sept. 18, as investors cheer the start of interest-rate cuts by the Federal Reserve and as odds of exchange-traded fund approvals soar.
- The crypto market is going up after the Federal Reserve interest rate decision.
- The SEC is expected to start approving several altcoin ETFs like XRP and Cardano.
- Futures open interest and shorts liquidations jumped.
Bitcoin (BTC) price rose to $117,500, while the market capitalization of all coins jumped to over $4.2 trillion.
Crypto market going up after the Federal Reserve cut
The main catalyst for the ongoing crypto market rally is the decision by the Federal Reserve to start cutting interest rates.
The Federal Open Market Committee slashed rates by 0.25% to a range of 4.00%–4.25%, while the dot plot pointed to further cuts in the coming meetings.
Therefore, while the rate cut was priced in, the crypto market is rising as the Fed was more dovish than expected. Before the meeting, most economists expected a hawkish cut because of the stubbornly high inflation rate.
Strong Bitcoin and Ethereum ETF inflows and the upcoming altcoin ETF approvals
The other reason for the ongoing crypto market rally is that the deadline for the approval of spot altcoin ETFs is nearing, and most investors expect the agency to approve some of them.
The odds of an XRP ETF approval have jumped to 97%, while those of Cardano (ADA) have risen to 87%. In anticipation of this, the SEC approved the generic listings standards that will allow them to launch without going through the lengthy process in the future.
Meanwhile, demand for existing Bitcoin and Ethereum ETFs has continued rising this month. Bitcoin ETFs have added more than $2.5 billion in assets this month, bringing total inflows to $57.3 billion. Similarly, Ethereum ETFs have added more than $146 million in assets this month.
Rising open interest and shorts liquidations
The crypto market is also rising as the futures open interest rise and shorts liquidations rise.
CoinGlass data shows that futures open interest jumped by 3.28% in the last 24 hours to $227 billion, while short positions worth more than $402 million were liquidated.
110,500 traders were liquidated in the last 24 hours, with the biggest one being a Bitcoin short worth over $42 million.
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