Hi all, I'm new to Crypto market. Would like to ask will US drop interest rate affect Crypto market in future ? Because I heard some people said that US drop interest rate = create biggest bubble and might explode next year (financial crisis). If this financial crisis happen, will it affect Crypto market ? If yes, will Crypto market rise or drop ... ?
An interest rate drop would open up easier credit, which would in turn flow into capital markets. So a drop in rates would theoretically positively benefit bitcoin's price, all else being equal.
One of the main channels of monetary policy transmission is the asset channel, which bitcoin is a class of.
However, your suggestion that there is some sort of cause and effect between a rate cut and a financial crisis is unclear/unjustified. I'm not sure if you were misinformed or potentially misled into thinking this, but generally monetary policy is countercyclical, i.e. in response to financial conditions.