A widely followed crypto analyst says digital assets need looser monetary policy before they can move higher.
In a new video update, crypto strategist Benjamin Cowen tells his 806,000 YouTube subscribers that the Federal Reserve needs to reverse course on its tight monetary policy before crypto markets can take off.
Bitcoin (BTC) has been slowly depleting since March due to the Fed’s hesitation to engage in quantitative easing, according to Cowen.
However, he believes that the most likely scenario is that the Fed will ease its monetary policy by September.
“Can the crypto market sustainably evolve before the Fed shifts to looser monetary policy? I don’t know… It’s possible the market will calm down a bit for the rest of 2024. When the market gets crazy, it’s hard to see, but you just have to take a step back.”
If you look at what’s happened since March, Bitcoin has been going down slowly. I think the reason is that markets need more accommodative policy, quantitative easing.
The market is waiting a bit, because we don’t really know when this is going to happen. Now, we think September seems to be the most likely outcome.
Cowen goes on to say that the cryptocurrency king’s volatility in recent months is due to fluctuating expectations about when and how the Fed will cut rates.
“Expectations are constantly changing, which can also cause the market to go into a kind of see-saw pattern, where it keeps going up and down. I think it’s kind of a swing from one extreme to the other in terms of expectations (for the Fed).”
At the time of writing, Bitcoin is trading at $58,776, down 4.19% in the last 24 hours.
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