Federal Reserve Cuts Rates; CFTC Approves Bitcoin as Derivatives Collateral

The U.S. Federal Reserve lowered its benchmark rate by 25 basis points, while the CFTC confirmed Bitcoin’s eligibility as collateral in derivatives markets.

BTC
ZEC

Summary

The Federal Reserve reduced its benchmark interest rate by 25 basis points to a range of 3.50%-3.75%, raising the probability of a pause in January to 78%. This monetary move coincided with sharp volatility in cryptocurrencies, with NIGHT rising 58.47% and ZEC dropping 11.10%. Additionally, the CFTC (U.S. derivatives regulator) confirmed that Bitcoin can be used as collateral in derivatives markets.

Terms & Concepts
  • Basis Points: A unit of measure for interest rates, equal to 0.01%.
  • CFTC (U.S. derivatives regulator): The Commodity Futures Trading Commission, overseeing futures and derivatives markets in the United States.
  • Collateral in Derivatives Markets: Assets pledged to secure a position in derivatives trading, reducing counterparty risk.