Investment Learning

  • March 20, 2024

Fed Chair Powell Discusses Balancing Employment and Inflation Risks

According to PANews, Federal Reserve Chairman Jerome Powell stated that the risks of achieving employment and inflation targets are being better balanced as the tense supply-demand relationship in the labor market eases. Inflation has significantly eased in the past year but remains above the Fed's set 2% long-term target, and long-term inflation expectations are still unstable. If appropriate, the Fed will maintain the federal funds rate target range at its current level for a longer period. Powell said that the Federal Open Market Committee believes it is 'inappropriate' to lower the target range before having confidence in inflation consistently moving towards 2%. However, the Fed has not yet gained the confidence to begin cutting interest rates from various data. Powell also mentioned that discussions took place during the meeting about slowing down the reduction of the balance sheet, and that it would be appropriate to slow down the pace of the reduction soon. Slowing down the reduction will ensure a smooth transition, alleviate pressure on the money market, and limit the risk of fluctuations in the money market.

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  • March 20, 2024

Potential Rate Cut Still on the Table for May or June, Suggests Powell

According to Odaily: Recovery in the stock market and boost in risk assets, sparked by Federal Reserve Chairman Powell's stance on inflation, continued when he suggested that a rate cut in May or June hasn't been ruled out yet. The statement came on March 21, and has instilled further confidence in the market anticipating potential monetary relaxation. Earlier worries in the market, spurred by January and February's inflation reports, hinted at possible delays in the Federal Reserve's interest rate reductions. However, Powell's inflation perspective, along with his open stance about potential rate cuts in the coming months, has played a key role in recent stock market upturns, as gains continue to accelerate.

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  • March 20, 2024

US Congress May See Stablecoin Bill This Year, Say Lawmakers

According to CoinDesk, US Rep. Patrick McHenry and Sen. Cynthia Lummis have stated that there is a potential path for a stablecoin bill in Congress this year, although they could not provide a specific timeline. The US Senate has been lagging on the stablecoin issue, with no committee work on a bill yet. McHenry, the chairman of the House Financial Services Committee, said that a stablecoin bill is largely worked out in the House of Representatives and just needs a scheduled floor vote. He has been working with Rep. Maxine Waters, the panel's top Democrat, on a stablecoin bill for nearly two years. Sen. Cynthia Lummis also spoke at the event, saying those working on the stablecoin bill in the Senate are speaking 'daily' with their House counterparts. She predicted that a compromise bill is the most likely crypto legislation to make it in 2024. Lummis noted that Sen. Chuck Schumer, the majority leader of the Senate, has said he is willing to consider such a bill. McHenry's committee has previously passed a stablecoin bill in his committee with a bipartisan vote that saw several Democrats supporting the Republican-driven version despite Waters' opposition.

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  • March 20, 2024

Federal Reserve Chairman Asserts: Premature to Study Central Bank Digital Currency

According to Odaily: Federal Reserve Chairman, Powell, on March 21, weighed in on the issue of the Central Bank Digital Currency (CBDC), stating that it is premature for the Federal Reserve to investigate it. He affirmed that for a digital dollar to be launched, legislative authorization is mandatory. It was made clear that the Federal Reserve is far from launching a Central Bank Digital Currency of its own. This stance by the Chairman emphasizes the complexity and regulatory challenges the potential adoption of digital currencies presents to financial establishments globally.  

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  • March 20, 2024

Fed Chair Powell Forecasting Monetary Easing Amid Cooling Inflation and Jobs Growth

Following recent deliberations, Federal Reserve Chairman Powell has hinted at a significant upcoming shift in the US monetary policy. Powell indicated on March 21 that the policy interest rates might have peaked, making it fitting to start easing monetary policy at some point during the year. Powell spotlighted the considerable economic progress, emphasizing the notable tapering off of inflation. However, he acknowledged that in spite of ongoing efforts to lower inflation, uncertainties persist in the economic outlook. While job creation remains strong, Powell underlined that robust employment growth alone wouldn't suffice to delay rate cuts. He clearly stated that if the labor market weakens substantially, it would provide a suitable context to initiate interest rate reductions. These recent statements from the Federal Reserve Chairman have instilled market confidence, prompting a return to risk assets and a boost in the stock market, even though the potential for interest rate cuts in May or June hasn't been ruled out. The Federal Reserve continues to monitor several complex factors shaping their monetary policies, with a particular watch on employment trends and inflation.

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  • March 20, 2024

Ethereum Foundation Removes Warrant Canary, Receives Voluntary Enquiry from State Authority

According to Blockworks, the Ethereum Foundation, a non-profit organization supporting the Ethereum ecosystem, removed the warrant canary from its website on February 26. The removal indicates that the foundation has received a government subpoena. Ethereum web developer Pablo Pettinari wrote, "[W]e have received a voluntary enquiry from a state authority that included a requirement for confidentiality," alongside a code commit removing the canary. The Ethereum Foundation is responsible for handling grants and providing research for the Ethereum ecosystem, but it does not control or lead Ethereum. Ethereum co-founder Vitalik Buterin serves on its executive board. In 2019, the Ethereum Foundation mistakenly removed its warrant canary, but this time it appears to be a genuine removal. The price of ether (ETH) fell more than 2% immediately after the news broke, contributing to a bearish week for the token. Some industry watchers believe that the Ethereum Foundation's "voluntary enquiry" may not be a significant issue. Mike Selig, partner at Willkie Farr & Gallagher, said, "It's extremely common for crypto protocol foundations to receive voluntary requests for information from federal and state regulators. And subpoenas are about as sure as the sunrise for a crypto entity." The Ethereum Foundation has not yet responded to a request for comment.

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  • March 20, 2024

Celsius Network Bankruptcy Advisors Seek Over $2 Billion in Withdrawals to Avoid Potential Lawsuits

According to PANews, advisors overseeing the gradual liquidation of Celsius Network LLC have requested the return of over $2 billion from major clients before the platform files for bankruptcy to avoid potential lawsuits. A supervisory committee established in Celsius' Chapter 11 bankruptcy case has begun contacting clients who withdrew more than $100,000 from the platform before the company's bankruptcy in July 2022. The assets recovered through this process will be used to repay creditors who have not withdrawn funds from Celsius. The committee stated that the recovery process would only affect about 2% of Celsius users, who collectively withdrew approximately 40% of the platform's assets within 90 days before the company filed for bankruptcy protection. At the time of filing for bankruptcy, Celsius reported having approximately $6 billion in assets, 1.7 million registered users, and 300,000 active users with account balances exceeding $100. The committee said that if clients who could potentially become targets of clawback lawsuits choose to settle, they will be offered 'preferential rates,' while clients who choose not to settle may be forced to return much higher amounts through potential litigation.

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  • March 20, 2024

Grayscale Predicts Shift from US Government Bonds to Bitcoin as Macro Asset

According to Foresight News, Grayscale has expressed on platform X that if the federal debt stock significantly increases in the coming years, overseas investors may lose interest in US government bonds. They may begin to shift from the US dollar to other currencies, such as Bitcoin. Bitcoin can be considered a macro asset, an alternative currency system, and a 'store of value' competing with the US dollar. Grayscale believes that the potential decrease in interest for US government bonds could lead to investors seeking alternative assets like Bitcoin. As a macro asset, Bitcoin offers a different currency system and store of value that could attract investors looking for options outside of the traditional US dollar-backed investments.

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  • March 20, 2024

Ethereum Foundation Under Investigation by Unnamed National Authority

According to PANews, the Ethereum Foundation is reportedly under investigation by an unnamed 'national authority,' as per the organization's GitHub repository. The scope and focus of the investigation remain unclear at the time of writing. A document submitted to GitHub on February 26, 2024, states, 'We have received a voluntary investigation from the national authority, which includes confidentiality requirements.' The Ethereum Foundation has not responded to requests for comment. Previously, the Ethereum Foundation's website contained the following disclosure: 'The Ethereum Foundation has never been contacted by any institution in any part of the world without disclosing contact information. The Ethereum Foundation will publicly disclose any investigation by government agencies outside the normal scope of business operations.' According to the change log, this footer was removed on February 26, along with the GitHub website's Warrant Canary security statement.

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