With the U.S. Federal Reserve raising the federal funds rate to 5.25%, the crypto markets are wondering what comes next. The activity in BTC and ETH has been declining and there is reduced correlation with traditional assets such as the S&P 500, Nasdaq, and DJIA. One factor that might explain this decoupling is that cryptos are being viewed as an alternative to the fiat currency debasement and ETH's contracted supply.

Perpetual funding rates for BTC and ETH remain positive, an indication that the market is bullish. Furthermore, the supply held by addresses with more than 100,000 BTC and 100,000 ETH is increasing and whale movement appears to be more strategic.

It’s obvious that digital assets are branching out on their own. The economic news will inevitably have some impact on prices, but likely with a different scope than what affects traditional assets.

Investors should stay attuned to BTC and ETH's pricing mechanisms, but they should also monitor the supply released from altcoins. They also need to be aware of the macro environment, particularly as it pertains to fiat currencies aiming to combat inflation. Keeping an eye on these trends will help investors predict the direction for crypto markets and find opportunities for greater alpha.



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