CoinEx Insight released the comprehensive report on the cryptocurrency market in September 2024. The crypto market was driven by significant policy changes and new technological developments. The key event this month was the Federal Reserve's 50-basis-point rate cut, which brought optimism to the market and sparked a strong rebound in risk assets, including cryptocurrencies. This dovish stance was echoed by similar actions from the European Central Bank (ECB) and the Bank of England (BoE), reversing the previous market decline, with Bit leading this upswing.
Bit's Bullish Breakout
At the start of the month, Bit's trading price was volatile, reaching a low of $52,700. However, after the Federal Reserve announced the rate cut, Bit rose from $58,000 to a recent high of $66,000, ultimately closing at $63,300, a gain of over 20%. This rebound was reflected across the entire cryptocurrency market. Bit is now aiming for the critical $70,000 resistance level, and the macroeconomic outlook for the remainder of 2024 appears positive, especially with the continued impact of the Federal Reserve's policies.
Recession Risk
Global markets closely monitored central bank policies in September. The Federal Reserve's recent forecasts show that the GDP growth projections for 2025 and 2026 remain unchanged at 2%, indicating confidence in the economy's resilience to ongoing policy changes. At the same time, the inflation outlook remains within manageable levels. However, with the expected rise in the unemployment rate, the Federal Reserve's actions reflect potential pressures in the labor market.
Source: Federal Reserve, data as of September 18, 2024
USD/JPY - A Key Variable to Watch
However, market participants are closely monitoring variables such as the USD/JPY exchange rate, as continued rate hikes by the Bank of Japan could impact global liquidity.
Technological Innovation: Fractal Bit Mainnet
One of the most significant technological developments this month was the launch of the Fractal Bit mainnet on September 9th. Fractal Bit is a Layer 2 solution that improves the transaction efficiency of Bit while maintaining compatibility with the main Bit network. It allows for the expansion of functionalities, such as the OP_CAT opcode, enabling developers to test new features without disrupting the core system. This innovation has made Fractal Bit one of the top three proof-of-work chains by computational power and has received the support of the ViaBTC mining pool, with CoinEx being the first exchange to list its native FB token. For CoinEx's analysis of Fractal Bit, please refer to "Fractal Bit: The Pioneering Network of Bit – Analysis of Technical Innovation and Challenges".
Challenges in the Ton Ecosystem
Despite the optimism in the crypto market, the Ton blockchain has faced challenges with its new tokens CATI and HMSTR. These two tokens have performed poorly since their listings, declining by 55% and 35%, respectively. Concerns have been raised about the sustainability of the "click-to-earn" model, as market saturation may limit the appeal of similar projects. The future of the Ton ecosystem will largely depend on its ability to provide a unique value proposition to sustain long-term growth.
The Meme Token Frenzy Driven by Social Media
September also witnessed the resurgence of meme tokens, driven by viral trends on social media. Animal-themed tokens, such as the Thai Pygmy Hippo Moo Deng, Penguin (PESTO), and Frog (OMOCI), have generated speculative interest, particularly on the Solana blockchain. The daily token creation level on Pump.Fun has rebounded to the highs seen earlier this year. While meme tokens have garnered attention, their volatility is extremely high, and investors are advised to exercise caution during the hype.
Looking Ahead: Economic Data and Market Sentiment
Although the inflow of stablecoins has slowed, September ended with $2.9 billion, reflecting the market's sustained investor confidence. As October unfolds, market participants will closely monitor economic data and the U.S. elections, which could bring the next wave of activity to the crypto space.
In summary, September 2024 was a pivotal month for cryptocurrencies, with macroeconomic policies, technological innovations, and speculative trends playing crucial roles in shaping the market's direction. With global monetary policies becoming more accommodative and technological advancements, the outlook remains optimistic as we progress towards 2025.
