Kraken Analysts Eye Fed Rate Cuts to Boost Crypto After Jobs Data Shock

Group 1: Federal Reserve and Labor Market - Recent historic downturn in the US labor market may prompt the Federal Reserve to lower interest rates, creating a favorable environment for assets like Bitcoin [1][2] - The labor market revision was more severe than during the 2008 financial crisis, indicating notable weakness and justifying a shift in the Fed's focus from inflation to employment [2] - Analysts project three expected Fed rate cuts before the end of the year, likely increasing investor appetite for risk assets [2] Group 2: Crypto Market Dynamics - A rotation in institutional capital is evident, with significant fund flows moving into spot Ether ETFs while Bitcoin funds experienced minor outflows, indicating growing investor confidence in the broader digital asset ecosystem [3] - XRP exceeded $1 billion in open interest, demonstrating strong institutional demand despite the absence of a US spot ETF product [4] - Bitcoin's realized volatility has declined to record lows, attributed to the launch of spot ETFs and the rise of strategies like covered calls, indicating a maturing market structure [5]