Fidelity: Fed rate cuts could be good for DeFi and stablecoins

BlockBeats news, on January 15, according to Cointelegraph, Fidelity said that the expected interest rate cut by the Federal Reserve may revive the interest of major institutions in decentralized finance (DeFi) and stable coins, provided that the infrastructure is further developed this year. In its 2024 Digital Asset Outlook report released on January 13, Fidelity said that although institutions were expected to get involved in DeFi last year for the benefits of DeFi, as the Federal Reserve’s interest rate hikes pushed them to switch to traditional fixed income products that are “considered to be safer,” they eventually Didn't happen. “In the current risk-off environment, institutions believe that the mid-single-digit returns offered by DeFi yields are too low for the risks associated with experimenting with smart contracts.” The report stated that if DeFi income "becomes more attractive than traditional finance (TradFi) income again and more developed infrastructure emerges," institutions may have "new interest" in DeFi in 2024.