Federal Reserve Set to Implement Another Rate Hike in November
According to Pat LaVecchia, CEO of Oasis Pro, the Federal Reserve is expected to implement another rate hike in November. During the September meeting, the institution signaled a more aggressive stance on interest rates due to strong economic growth. LaVecchia believes that this indicates the current cycle of monetary tightening is not over yet. While statistical indicators suggest otherwise, he predicts that the next rate hike will likely happen in November, with 2024 being a period of stability for interest rates. LaVecchia does not anticipate any rate cuts until 2025 but doesn’t dismiss the possibility of a soft economic landing in the future.
Tokenization of Assets and U.S. Treasuries
LaVecchia is closely monitoring the tokenization of assets, particularly U.S. Treasuries. Tokenization allows for real-world assets to be represented digitally on the blockchain, making them more easily tradable and accessible. Over a billion dollars’ worth of U.S. Treasuries have already been tokenized, attracting interest from crypto funds seeking safe returns. The current high yields on 10-year U.S. Treasuries at 4.68% make tokenized U.S. Treasuries even more attractive, potentially opening up the Treasury market to accredited and retail investors and increasing demand for U.S. debt instruments.
Growth Potential in the Tokenization Industry
LaVecchia believes that the tokenization industry has significant growth potential. While Citibank estimates it to be worth around $10 trillion in a decade, LaVecchia considers this a conservative figure and expects it to be much higher. The market for tokenized real-world assets has already expanded from $300 million last year to billions this year.
Potential Impact of U.S. Elections on Crypto Regulation
LaVecchia briefly mentioned the potential impact of the 2024 U.S. elections on crypto regulation but does not anticipate any significant changes in the next 18 to 24 months.
Hot Take: Federal Reserve to Continue Rate Hike Cycle
Despite market expectations, the Federal Reserve is set to implement another rate hike in November, according to Pat LaVecchia, CEO of Oasis Pro. The institution’s more aggressive stance on interest rates during the September meeting suggests that the current cycle of monetary tightening is not over yet. LaVecchia predicts that the next rate hike will likely occur in November and expects stability in interest rates for 2024. He also believes in the significant growth potential of the tokenization industry and highlights the attractiveness of tokenized U.S. Treasuries given their high yields. However, he does not foresee any major changes in crypto regulation for the next 18 to 24 months.
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