Cryptocurrencies experienced a significant rally led by Bitcoin, which saw a 6% increase on Wednesday. This wave of gains also boosted altcoins, with Dogecoin climbing by 4.9%, Shiba Inu by 5.6%, Algorand rising over 11%, and Lido DAO up by 5.5%. The surge came despite a lack of major news but coincided with a regulatory announcement regarding spot crypto ETFs.
The uptick in cryptocurrency values aligns with the broader positive momentum observed in global equity markets, including those in the US, Germany, and Asia. Investors may be reacting to the latest developments from the Securities and Exchange Commission (SEC), which postponed decisions on key crypto investment vehicles. The SEC is considering Hashdex's proposal to convert its Bitcoin futures ETF into a spot ETF, as well as Grayscale's Ethereum vehicle, keeping the door open for direct crypto investments.
Supporting the shift towards cryptocurrencies is October's Consumer Price Index (CPI) data, which indicated slowing inflation. This could signal a potential shift in the Federal Reserve's aggressive interest rate hike policy. With lower expectations for rate hikes, investors might find cryptocurrencies more attractive compared to traditional treasury notes.
The market movement reflects a growing sentiment that regulatory clarity and macroeconomic factors are increasingly influential in investment decisions within the cryptocurrency space. As the SEC deliberates on the conversion of cryptocurrency-based ETFs and inflation trends become clearer, market participants seem to be adjusting their strategies accordingly.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.