The much-awaited interest rate hike by the US Federal Reserve had finally come to pass, with interest rates being raised by 75 basis points earlier yesterday. Much to the delight of crypto traders, the reaction in the cryptocurrency market had largely been positive, with both Bitcoin and Ethereum seeing price climbs. Digital assets are increasingly gaining notoriety in these inflationary conditions as being safe-haven assets, which may explain the growing demand. Market participants also expect the Fed to now move towards reversing gear on its aggressive stance.

Highlights of the week

• Singapore’s central monetary authority, yesterday, reiterated its instructions to crypto exchanges operating within the country to comply with sanctions leveled against the Russian Federation, and by extension, users that are based there. The call comes after the recent publishing of a report which has indicated that Russian citizens have raised millions of dollars through crypto-related transactions, which are being redirected to support the invasion of Ukraine.
• In a groundbreaking development, the border-to-border payment and funds transfer giant, MoneyGram has finally launched crypto-transactions on its platform. It now allows users to buy, sell and simply hold Bitcoin, Ethereum, or Litecoin. At present this facility has only seen enabling in the United States, with expansion expected to gradually take place.
• After successful results seen by central-bank-endorsed digital currencies across Asia, the Indian Central Bank too initiated its Digital Rupee pilot project, earlier this week. Nine national banks are collaborating on this project. In this initial phase, digital currency is seeing use in select locations, for retail purposes.
• One of South Africa’s largest retail store chains, Pick n Pay has announced plans of accepting BTC as valid currency in all its locations across the nation. It further stated that customers may use any bitcoin transfer app, and scan with a QR code for high-speed payments. This comes as a major development for crypto-acceptance in the country.
• The financial world’s titan, JP Morgan, for the first time ever, executed an international transaction by means of a DeFi tool, on a public blockchain. Singapore’s central monetary authority was a party to this transaction, which saw initiation with the intention of investigating blockchain applications for conventional financial markets.

Crypto fear & greed index

After its improvement, last week, from the ‘extreme fear’ to the ‘fear’ zone, the cryptocurrency market sentiment has impressively maintained its positioning. Following its step up, from the 25^th of October, the index has on average stuck close to the 30 mark on the index, as it stands today. What is most positive about the sentiment today is that the market has maintained its perception of crypto assets, even after the US Federal Reserve hiked interest rates by 75 basis points.

There was anticipation among many bears in the market of a potential collapse in prices after such a substantial move by the Fed, which has evidently subsided. Bulls in the market now have the go-ahead to continue upping their long positions in the market. Those who were on the fence, are likely to tilt toward crypto, now that market sentiment appears unchanged in the face of macroeconomic disruptions.