Bank

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Reserve

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<p class="is-style-lead">Bitcoin and most altcoins remained in a tight range as the crypto fear and greed index moved to the fear zone of 33 ahead of the Federal Reserve and Bank of Japan decisions.</p>
<p>Bitcoin (<a rel="noopener noreferrer nofollow" href="https://crypto.news/price/bitcoin/">BTC</a>) has been stuck below $60,000 this week while Ethereum (<a rel="noopener noreferrer nofollow" href="https://crypto.news/price/ethereum/">ETH</a>) was below $2,400. Other big coins like Solana, Tron, and Litecoin were barely moved this week.</p>
<p>Bitcoin’s consolidation occurred as MicroStrategy, the largest corporate holder of Bitcoin, added more coins to its balance sheet. The company now holds 244,800 coins worth over $14.1 billion. Spot <a rel="noopener noreferrer nofollow" href="https://crypto.news/spot-bitcoin-etfs-rebound-with-inflows-ether-etfs-extend-outflows/">Bitcoin ETFs</a> saw net inflows of over $144 million in the first four days of the week.</p>
<p>Ethereum, on the other hand, remained under pressure as ETF outflows continued, and as Vitalik Buterin and the Ethereum Foundation reportedly sold more coins. There are signs that more Ethereum whales are liquidating their tokens.</p>
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   <p lang="en" dir="ltr">Metalpha deposited 6,999 <a href="https://twitter.com/search?q=%24ETH&amp;src=ctag&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">$ETH</a>($16.4M) to <a href="https://twitter.com/hashtag/Binance?src=hash&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">#Binance</a> again 1 hour ago.<a href="https://twitter.com/hashtag/Metalpha?src=hash&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">#Metalpha</a> has deposited a total of 62,588 <a href="https://twitter.com/search?q=%24ETH&amp;src=ctag&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">$ETH</a>($145.1M) to <a href="https://twitter.com/hashtag/Binance?src=hash&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">#Binance</a> in the past 6 days and currently holds 23.5K <a href="https://twitter.com/search?q=%24ETH&amp;src=ctag&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">$ETH</a>($55M).<a rel="noopener noreferrer nofollow" href="https://t.co/3hqVXQvHlu" target="_blank">https://t.co/3hqVXQvHlu</a> <a rel="noopener noreferrer nofollow" href="https://t.co/3zVS4Irbmq" target="_blank">pic.twitter.com/3zVS4Irbmq</a></p>— Lookonchain (@lookonchain) <a href="https://twitter.com/lookonchain/status/1834234432305451197?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">September 12, 2024</a>
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<h2 class="wp-block-heading" id="federal-reserve-and-boj-decisions-ahead">Federal Reserve and BoJ decisions ahead</h2>
<p>Looking ahead, cryptocurrency prices could come under pressure next week as the Federal Reserve and the Bank of Japan meet.</p>
<p>The Fed is expected to cut interest rates following this week’s <a rel="noopener noreferrer nofollow" href="https://crypto.news/aave-uniswap-icp-climb-as-bitcoin-retreats-with-cooling-us-cpi/">encouraging U.S. inflation</a> data and last week’s <a rel="noopener noreferrer nofollow" href="https://crypto.news/bitcoin-and-altcoins-rise-as-nfp-data-point-to-a-large-rate-cut/">mixed nonfarm payrolls report</a>. The swap market is predicting a 0.50% interest rate cut at that meeting.</p>
<p>Economists <a href="https://www.investing.com/economic-calendar/interest-rate-decision-165" target="_blank" rel="noopener noreferrer nofollow">expect</a> that the BoJ will leave interest rates unchanged at 0.25%. However, as it did last time, the bank may catch the market by surprise by hiking interest rates again. In a <a href="https://www.reuters.com/markets/asia/boj-will-remain-vigilant-unstable-market-moves-says-governor-ueda-2024-08-23/" target="_blank" rel="noopener noreferrer nofollow">recent statement</a>, Kazuo Ueda, the bank’s governor, hinted that he may be ready to hike again if inflation remains high.</p>
<p>You might also like: <a rel="noopener noreferrer nofollow" href="https://crypto.news/what-is-carry-trade-explained/"> How the Yen carry trade led to a global market rout? </a></p>
<p>A Fed cut and a BoJ rate hike would reduce the spread between U.S. and Japanese yields, invalidating a carry trade that has existed for years.</p>
<p>In a carry trade, investors borrow from low-interest rate countries and invest in higher-interest rate ones. This likely explains why the Japanese yen rose to 140 against the U.S. dollar, a 13% increase from its lowest point this year.</p>
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   <p lang="en" dir="ltr">The <a href="https://twitter.com/hashtag/yen?src=hash&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">#yen</a> is another 0.9% stronger so far today, now trading at 140.5 per US dollar as markets expect a further move up in interest rate differential in favor of <a href="https://twitter.com/hashtag/Japan?src=hash&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">#Japan</a>.<br>Interestingly, the last month’s notable appreciation (chart below) has been relatively “quiet.”<a href="https://twitter.com/hashtag/economy?src=hash&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">#economy</a> <a rel="noopener noreferrer nofollow" href="https://t.co/EVTXyJKrk2" target="_blank">pic.twitter.com/EVTXyJKrk2</a></p>— Mohamed A. El-Erian (@elerianm) <a href="https://twitter.com/elerianm/status/1834542586758943072?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">September 13, 2024</a>
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<p>The impact of this unwind could have an impact in the cryptocurrency industry as it happened in August. Bitcoin dropped to $49,000 while Ethereum fell to $2,100 in during the crypto <a href="https://crypto.news/deja-vu-what-bitcoins-past-patterns-reveal-about-its-post-black-monday-future/" target="_blank" rel="noopener noreferrer nofollow">Black Monday</a>.</p>
<p>Therefore, there is a likelihood that Bitcoin, altcoins, and stocks will experience some volatility as the Fed and BoJ make their decisions on Sept. 18 and Sept. 20, respectively.</p>
<p>You might also like: <a rel="noopener noreferrer nofollow" href="https://crypto.news/bitcoin-chart-showing-mixed-signals-following-crypto-black-monday/"> Bitcoin chart showing mixed signals following crypto Black Monday </a></p>

Crypto braces for a key risk: Japanese yen carry trade unwind

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