The crypto ecosystem is on the cusp of one more important week, ushered in by a number of main developments going down throughout completely different networks. This week’s highlight falls on Bitcoin, Fantom, Avalanche, Stacks, and LayerZero, every of which is going through a pivotal milestone. The broader macro backdrop can also be crucial, significantly the December 18 Federal Open Market Committee (FOMC) interest-rate determination in the USA.
#1 Bitcoin And Crypto Await The FOMC Determination
Bitcoin merchants and traders are watching the Federal Reserve’s coverage assembly scheduled for Wednesday, December 18, at 2:00 pm ET, with Fed Chair Jerome Powell’s press convention to comply with at 2:30 pm ET. Saxo Financial institution writes of their newest investor observe, “The Federal Reserve is extensively anticipated to ship a 25 basis-points (bps) charge lower this week, decreasing the goal vary for the federal funds charge to 4.25-4.50%.”
In response to futures knowledge, there’s a 95% chance of this transfer, which follows an analogous lower in November. Whereas the speed lower is seemingly priced in, the market will scrutinize the Fed’s Abstract of Financial Projections (SEP) and its “dot plot,” which depict the anticipated path of coverage charges for 2025 and past.
Any sign that the Federal Reserve might restrict the tempo of future cuts—significantly if it revises the dot plot from 4 charge cuts in 2025 down to a few and even two—would possibly weigh on risk-on belongings comparable to Bitcoin and cryptocurrencies. Many analysts level to the labor market, which has been softening, and to easing shelter inflation, evidenced by slowing rental value progress, as key justifications for extra charge cuts.
Associated Studying
Nevertheless, the Fed might convey a extra cautious stance and spotlight so-called “Trump-flation” dangers, referencing the potential of renewed commerce tariffs below the incoming Trump administration that would push inflation larger. If such inflationary dangers stay persistent, the Fed would possibly pause or scale back the tempo of cuts in 2025, which might be seen as a hawkish twist.
The brand new dot plot for 2025 is at the moment anticipated to point out round 3.625%—a baseline assumption of three charge cuts subsequent yr—however the market has speculated that this might transfer to three.875% if the Fed turns into extra cautious. The rapid response in Bitcoin will probably hinge on the assembly’s tone, with a much less dovish Fed doubtlessly introducing volatility to BTC value motion.
#2 Fantom (FTM)
Fantom is coming into a brand new period with the upcoming Sonic L1 mainnet launch, a transformative improve that can dramatically enhance community throughput and value effectivity. Builders behind Fantom have highlighted that Sonic is able to processing roughly 10,000 transactions per second, with near-instant finality—a marked leap from present community capabilities.
The deliberate modifications are additionally set to chop operational expenditures, with a reported 66% lower in validator node prices and minimized storage necessities. One other vital element is Fantom’s determination to keep up compatibility with the Ethereum Digital Machine, which ought to make it simple for EVM-based functions emigrate to the upgraded chain with out modifying their underlying code.
Sonic will even debut a brand new token, denoted as S, which is able to exchange the present FTM token at a one-to-one ratio.
The crypto dealer Jacob Canfield said by way of X, “Shared this setup x subs final week, however FTM is near a value discovery break. Must clear the bearish impulse base and shut a 4 hour candle and we are going to in all probability see swift value discovery. The chart coincides properly with the SONIC launch.”
#3 Avalanche (AVAX)
Avalanche might be one other focus within the crypto business, because the Avalanche9000 improve is ready to go dwell on the mainnet at the moment, on December 16. This follows a testnet debut on the “Fuji” testnet on November 25.
Associated Studying
The extremely anticipated mainnet launch is described by Avalanche’s core builders as probably the most important improve within the chain’s historical past. Compounding the thrill is Avalanche’s December 12 announcement of a $250 million non-public token sale led by Galaxy Digital, Dragonfly, and ParaFi Capital, with greater than 40 different entities taking part.
In response to official statements, this fundraising spherical strengthens Avalanche’s treasury, already valued at round $3 billion in AVAX tokens, and comes on the again of a earlier $230 million token sale in 2021.
Avalanche9000 incorporates the Etna Improve and key neighborhood proposals ACP-77 and ACP-125, altogether reimagining how Avalanche’s subnets perform—now known as layer-1s. In doing so, Avalanche transitions from a pricey validator system requiring 2,000 AVAX per occasion to a extra subscription-like mannequin that fees 1.33 AVAX per thirty days. The improve additionally focuses on cross-chain connectivity, enabling extra subtle interchain communication inside Avalanche’s broader ecosystem.
#4 Stacks (STX)
Stacks is one other identify to maintain on the radar because it prepares to launch sBTC on Tuesday, December 17, at 11:00 am ET. This new BTC-backed asset is designed to carry Bitcoin’s liquidity immediately into the DeFi sphere on Stacks, providing a rewards program that’s notably freed from staking necessities.
In response to the challenge’s official announcement, the sBTC Rewards Program supplies a 5% annual Bitcoin reward, paid out in bi-weekly installments, and the distribution is made in precise Bitcoin, not third-party tokens.
This system’s first part, commencing on December 17, will give attention to deposit performance and rapid rewards accrual for sBTC holders. The second part, at the moment deliberate for March 2025, is anticipated to layer in additional superior DeFi capabilities and reward buildings, thereby broadening the utility of sBTC.
#5 LayerZero (ZRO)
LayerZero rounds out the week’s watchlist with a governance milestone. On December 20, 2024, at 00:00 UTC, ZRO token holders will have interaction within the community’s first-ever charge change referendum, a vote that would activate a protocol charge on each LayerZero message.
The referendum is easy, posing the one query, “Flip the charge change on?” A majority vote of “Sure,” assuming quorum is met, would enact a charge that matches the underlying DVN and Executor prices for every message, successfully doubling the price of every cross-chain transmission.
The collected charges would then be used to purchase again and burn ZRO, doubtlessly decreasing the circulating provide and impacting the token’s economics. ZRO balances throughout Ethereum, Optimism, Base, Polygon, Avalanche, BNB Chain, and Arbitrum are all factored into every holder’s voting energy, consolidated seamlessly via LayerZero’s lzRead characteristic.
The referendum will final seven days, concluding on December 27, 2024. A 60% quorum of the circulating provide is required for the vote to be legitimate; if that threshold shouldn’t be met, the end result defaults to “No.” If the referendum passes, the protocol charge can be instantly activated, doubtlessly shifting the dynamics of how builders and customers handle cross-chain communications.
This governance mechanism is ready to repeat each six months, although the quorum requirement would lower by 5% every time if it’s not met, right down to a minimal ground of 20%.
At press time, Bitcoin traded at $104,748.
Featured picture created with DALL.E, chart from TradingView.com
