On October 10, financial news source COINOTAG reported insights from SwissOne Capital regarding the potential implications of the Federal Reserve’s *interest rate cut* cycle on Bitcoin’s market dynamics. The asset management firm articulated that this shift could impede Bitcoin’s recent *surge in market share*, which has expanded from 38% to 58% over the span of two years, outpacing the broader cryptocurrency market’s growth. This surge has contributed to the total *market valuation* of digital assets soaring beyond $2 trillion.
SwissOne Capital indicated that the recent 50 basis point *rate reduction* signifies the beginning of an easing cycle, which could cap Bitcoin’s *market share growth*. The firm further noted that historical data shows a negative correlation between Bitcoin’s market share and the U.S. federal funds rate. As past cycles reveal, such cuts often lead to a decline in Bitcoin’s market share.
Additionally, SwissOne Capital highlighted that with the *market capitalization of stablecoins* nearing 10% of the total crypto market cap, Bitcoin’s market share might plateau between current ranges and potentially 60%, suggesting a forthcoming significant correction. These insights underscore the intricate relationship between monetary policy and digital asset performance.