Coinbase’s CEO and co-founder, Brian Armstrong, recently gave a prediction regarding the future of cryptocurrencies in 2020. He believes that the current drop in the stock market and numerous interest rate cuts in banks around the world will lead to growth in the crypto industry for the rest of the year.
Armstrong gave this prediction shortly after the US Federal Reserve announced that it will cut its benchmark interest rate by 50 basis points. The move was announced as an attempt to preserve the US economy amidst the new coronavirus outbreak, and was soon mirrored by Canadian central bank, as well as others.
Banks worry about coronavirus’
impact on the economy
The Federal Reserve cut is the first one that
the US central bank has made since December 2008, meaning the first one since
cryptocurrencies came to be. In its own statement, the bank addressed the
virus, stating that it poses evolving risks to economic activity. Due to the
risks, but also in support of achieving maximum employment and price stability,
the Federal Open Market Committee, made a decision to lower the target range
for the federal funds rate.
Jerome H. Powell, the Fed Chairman, later
added that the persistence and magnitude of the virus’s effect on the US
economy is extremely uncertain. As the situation remains fluid, the committee
decided that the risks to the country’s outlook have changed, and with that
change, the Fed is making its own changes.
A similar move was made by the Reserve Bank of
Australia, which was actually the first major central bank that made such a
move. Its own benchmark cash rate dropped by only 25 basis points, which still
reduced the total to a record…