US-Listed Crypto Stocks Surge Following Fed’s Significant Rate Cut, Reports Reuters

By Niket Nishant

U.S.-listed cryptocurrency shares experienced a significant surge on Thursday following a half-percentage point interest rate cut that heightened risk appetite. This development added momentum to an industry that has already celebrated substantial victories this year.

The interest rate adjustment might reignite enthusiasm for bitcoin, the leading cryptocurrency, which often influences the entire sector as investors seek higher returns and move away from safer assets. Bitcoin rose by 4.6% and was last priced at $62,991.

"There’s over $6 trillion in money market funds, soon yielding 50 basis points less," noted Matt Mena, a crypto research strategist. "This move could signal a return of liquidity, igniting a risk-on sentiment and potentially fueling a sharp rally."

MicroStrategy, a major corporate supporter of bitcoin, saw shares increase by nearly 10%. Cryptocurrency exchange Coinbase experienced a 6.4% jump in its share price. Digital asset miners such as Riot Platforms, Marathon Digital, and CleanSpark rose by 1.6%, 4%, and 5.3%, respectively.

Henry Robinson, co-founder of crypto mining firm Decimal Digital Currency, commented, "The cut is aggressive, but more important than its immediate effects is what it signals. This could indicate an end to hawkish monetary policy for the foreseeable future."

Earlier this year, exchange-traded funds that track bitcoin and ether received significant regulatory approvals, which had boosted investor confidence. However, sentiment has been more volatile in recent weeks due to changing dynamics surrounding the upcoming U.S. presidential election.

Republican candidate Donald Trump has positioned himself as supportive of bitcoin, promising to dismiss SEC Chair Gary Gensler, whom the industry has criticized for his strict enforcement approach, "on day one." Trump launched a new crypto initiative earlier this week and was reported to have used bitcoin to purchase burgers for his supporters at a bar in New York.

Despite the political landscape, industry leaders believe the U.S. will maintain a favorable stance towards cryptocurrency, regardless of the election outcome.