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The crypto ecosystem is on the cusp of yet one more important week, ushered in by a number of main developments happening throughout totally 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 important, 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 buyers 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) fee lower this week, lowering the goal vary for the federal funds fee to 4.25-4.50%.”
In response to futures knowledge, there’s a 95% chance of this transfer, which follows an identical 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 fee cuts in 2025 down to a few and even two—may weigh on risk-on belongings corresponding to Bitcoin and cryptocurrencies. Many analysts level to the labor market, which has been softening, and to easing shelter inflation, evidenced by slowing rental worth progress, as key justifications for added fee cuts.
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Nevertheless, the Fed might convey a extra cautious stance and spotlight so-called “Trump-flation” dangers, referencing the potential for renewed commerce tariffs underneath the incoming Trump administration that might push inflation greater. If such inflationary dangers stay persistent, the Fed may pause or scale back the tempo of cuts in 2025, which might be considered as a hawkish twist.
The brand new dot plot for 2025 is at present anticipated to indicate round 3.625%—a baseline assumption of three fee cuts subsequent 12 months—however the market has speculated that this might transfer to three.875% if the Fed turns into extra cautious. The fast response in Bitcoin will doubtless hinge on the assembly’s tone, with a much less dovish Fed probably introducing volatility to BTC worth 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 price 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 necessary element is Fantom’s determination to take care of compatibility with the Ethereum Digital Machine, which ought to make it simple for EVM-based purposes emigrate to the upgraded chain with out modifying their underlying code.
Sonic can even debut a brand new token, denoted as S, which is able to substitute the prevailing FTM token at a one-to-one ratio.
The crypto dealer Jacob Canfield acknowledged by way of X, “Shared this setup x subs final week, however FTM is near a worth discovery break. Must clear the bearish impulse base and shut a 4 hour candle and we’ll most likely see swift worth discovery. The chart coincides properly with the SONIC launch.”
#3 Avalanche (AVAX)
Avalanche might be one other point of interest within the crypto trade, because the Avalanche9000 improve is ready to go reside on the mainnet at this time, on December 16. This follows a testnet debut on the “Fuji” testnet on November 25.
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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 excitement 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 collaborating.
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 expensive validator system requiring 2,000 AVAX per occasion to a extra subscription-like mannequin that fees 1.33 AVAX per 30 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 title 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 convey Bitcoin’s liquidity straight into the DeFi sphere on Stacks, providing a rewards program that’s notably freed from staking necessities.
In response to the venture’s official announcement, the sBTC Rewards Program gives 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 section, commencing on December 17, will deal with deposit performance and fast rewards accrual for sBTC holders. The second section, at present deliberate for March 2025, is anticipated to layer in additional superior DeFi capabilities and reward constructions, 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 price change referendum, a vote that might activate a protocol price on each LayerZero message.
The referendum is easy, posing the only query, “Flip the price change on?” A majority vote of “Sure,” assuming quorum is met, would enact a price 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, probably lowering 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 by way of 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 will not be met, the end result defaults to “No.” If the referendum passes, the protocol price can be instantly activated, probably 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 flooring of 20%.
At press time, Bitcoin traded at $104,748.
Featured picture created with DALL.E, chart from TradingView.com