Cryptocurrencies across the board are continuing to fall even as the market anticipates an additional interest rate cut from the Federal Reserve. Japan’s interest rates could move in the opposite direction, raising the possibility that investors may need to unwind crypto positions leveraged with Japanese yen.
Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue ”
While the Fed is expected to cut U.S. rates, the head of the Bank of Japan (BOJ) said on Monday that the Japanese central bank is weighing the “pros and cons” of a rate hike. If the BOJ does raise interest rates, investors who borrowed Japanese yen to purchase Ethereum and other crypto assets could be forced to sell to cover their positions.
Image source: Getty Images.
Today’s sell-off was, at least in part, driven by fear of a repeat of 2024’s flash crash, when a major unwind led to Ethereum dropping roughly 20% in a matter of days.
Though it stands out among cryptocurrencies, don’t mistake its relative stability for safety. Ethereum is still a risky asset. I think the current slide will continue. For more risk-tolerant investors with a long investment horizon, Ethereum is a solid pick.
Before you buy stock in Ethereum, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Ethereum wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $580,171!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,084,986!*
Now, it’s worth noting Stock Advisor’s total average return is 1,004% — a market-crushing outperformance compared to 194% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.
Read more on NASDAQ Stock Market
