Hi all, Liam here. 

Despite this week’s chop, several indicators suggest Bitcoin’s near-term outlook is a bit more stable — and bullish.

The ongoing US labour market slowdown continued on Wednesday, after private payrolls fell by an unexpected 32,000 jobs in November, pushing Bitcoin as low as $84,000.

The $1.8 trillion digital asset has since recouped those losses and then some. 

That’s because all eyes have turned back to the Federal Reserve. 

As beating back inflation and maintaining low unemployment are the central bank’s primary objectives, this week’s employment numbers have all but secured a rate cut next month. Lower interest rates make cash cheaper, spurring companies to take out loans to expand their businesses and hire more people.

Low rates also boost valuations in riskier asset classes, such as equities and digital assets, as investors seek to earn more from their money than from typical bonds. 

The Chicago Mercantile Exchange’s FedWatch Tool, which aggregates sentiment among analysts, now puts the odds of a quarter-point cut in December as high as 87%. 

Another poll that queried 100 economists also suggests that the majority support a rate cut at the upcoming meeting, according to Reuters.

It’s led some industry pundits to suggest a rosy year-end picture, too. 

“The end of year could be very good,” Bitwise chief investment officer Matt Hougan said during a panel on Wednesday. “There’s not much downside left.”

Which Kevin Hassett?

If not this year, then analysts at Goldman Sachs lay out the case for further cuts – and upside – next year. 

The bank’s chief economist, Jan Hatzius, said in a note this week that he expects cuts to pause in January. Then, by March and June, the Federal Reserve will get back to it. 

Between now and then, Hatzius expects rates to come down as much as three-quarters of a point by next Summer. 

Doubtful? 

Well, there’s reason to believe that, unlike the current Fed Chair Jerome Powell, who has quarrelled with US President Donald Trump over rates all year, his replacement is far more eager to start chopping away. 

Kevin Hassett is currently the frontrunner to replace Powell early next year. He’s already signalled his agenda, too. 

He told Fox News in November that if he were Powell, he’d already be cutting rates. 

Meanwhile, bond investors are already skittish that Hassett would lower rates far faster than they’d like. 

After the US Department of the Treasury solicited central Wall Street banks and asset managers on Hassett and other potential chairs, many raised concerns that he would cut rates to gratify the president, according to The Financial Times.  

Indeed, many are now wondering about how independent the alpha bank would be after Powell. 

“Is it, the Kevin Hassett who is the active participant in the Trump administration?” Claudia Sahm, the chief economist of New Century Advisors, told The Financial Times. 

“Or Kevin Hassett, the independent economist?” 

Either way, that’s good for Bitcoin. Right?

Bitmine stock jumps 15% as Tom Lee scoops up $150m more Ethereum

Hot on the heels of Ethereum’s Fusaka upgrade, Bitmine bought another $150 million worth of Ethereum on Wednesday, sending the company’s stock soaring into double digits. Lance Datskoluo reports.

Ethereum treasuries collapse 80% as the trade unwinds, Bitwise warns

Digital asset treasury companies purchased just 370,000 Ether in November, down 81% from August’s peak of 1.97 million, according to data from Bitwise.

The collapse marks the unwinding of what was supposed to be this cycle’s version of an “altseason,” reports Pedro Solimano.

Ethereum Fusaka upgrade goes live, bringing eightfold increase in ‘blob’ capacity

Ethereum underwent its second major upgrade of the year on Wednesday, further reducing transaction costs on affiliated layer 2 blockchains while improving the user experience and hardening the network against a common exploit, reports Aleks Gilbert.

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