Cryptos Remain Strong Ahead Of Fed's Decision

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Cryptocurrencies remained firm ahead of the Fed announcement after the crucial two-day policy setting meeting of the Federal Open Market Committee. The Fed is widely believed to raise interest rates by 75 points to 2.5 percent, aimed at tackling the consumer price inflation which has surged to 9.1 percent in the month of June. The Fed's decision is due at 2 p.m.

Markets are assigning a very low probability to a larger rate hike of 100 basis points. More than the absolute quantum of rate hikes, market speculation is spilling over to the likely level at which the Fed would stop hiking rates. Investors are hoping that the Fed would pause on the interest rate hikes before recession actually arrives.

Holding sway over the market sentiment is also the fact that the next meeting of the Fed would take place in the third week of September, after a two-month gap. Whether the two-month hiatus would goad the Fed to factor in the inflationary expectations is also lingering in investor minds.

The second quarter GDP data is due on Thursday and would throw up hints on whether the economy is headed for a recession. Crypto market fortunes would also be influenced by the earnings updates from Wall Street's tech sector, with which the digital assets have been displaying strong correlation, till very recently.

Overall crypto market capitalization is at $980 billion, versus $966 billion a day earlier. Overnight percent gains in categories like Centralized Exchanges (3.8%), Scaling (3.4%), Smart Contracts (3.4%), DAO (2.1%), Yield Farming (2%), Governance (1.8%), Decentralized Exchanges (1.5%) and Memes (1.3%) exceed the 1.25 percent overnight gains recorded in aggregate crypto market capitalization.

Bitcoin is trading at $21,283.59, edging up 0.85 percent from the levels a day ago. BTC touched a fresh 7-day low of $20,776.82 in the past 24 hours. The maximum it could climb in the past 24 hours was to $21,415.67.

Ethereum is trading at $1,457.42, having rallied 3.86 percent in the past 24 hours. Ether's 24-hour low of $1,362.95 was also a 7-day low. ETH could not breach past $1,470.74 in the past 24 hours.

Cardano (ADA) is hovering below the flatline, whereas all the other cryptocurrencies among the top 10 are trading in positive territory.

A big-picture view of the overall crypto market shows Bitcoin dominating 41.5 percent of the market. The Smart Contracts category comprising Ethereum, BNB, Cardano etc., is currently commanding 26.96 percent of the market. Stablecoins led by Tether, USDCoin, Binance USD, DAI etc. occupy 15.66 percent of the overall crypto market.

Cryptocurrencies of Centralized Exchanges now add up to 5.77 percent. BNB, UNUS SED LEO (LEO), FTX Token (FTT) and Cronos (CRO) are the toppers in this category.

The DeFi category led by Dai, Avalanche (AVAX), Wrapped Bitcoin, and Uniswap (UNI) command 5.35 percent of the overall crypto market.

The Web 3 category led by Polkadot (DOT), Chainlink (LINK), and Filecoin (FIL) command 2.14 percent of the overall crypto market in terms of market capitalization.

Among the remaining categories, Research grosses 1.93 percent; NFTs account for 1.91 percent; DAO sums up to 1.56 percent; Memes command 1.50 percent; Governance grosses 1.4 percent; Decentralized Exchanges amount to 1.4 percent; Metaverse commands 1.20 percent; Gaming and Scaling categories account for 1.1 percent each, whereas Yield Farming follows with a 1.0 percent market capitalization.

Harmony, which had recently lost $100 million in an exploit on its Horizon Bridge has proposed a plan to run a hardfork and issue more ONE tokens to reimburse the impacted users. However, many community members have opposed the move.

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