Top 5 Coins To Watch This Week
The crypto ecosystem is about to have another big week, ushered in by several major developments taking place on different networks. This week’s focus is on Bitcoin, Fantom, Avalanche, Stacks, and LayerZero, each facing a key milestone. The broader macro backdrop is also crucial, especially the December 18 U.S. Federal Open Market Committee (FOMC) interest rate decision.
#1 Bitcoin and Cryptocurrencies Awaiting FOMC Decision
Bitcoin traders and investors are watching the Federal Reserve’s policy meeting scheduled for Wednesday, December 18 at 2:00 pm ET, with Fed Chairman Jerome Powell’s press conference set to take place at 2:00 pm ET Held at 2:30. Saxo Bank wrote in its latest report Notes to investors“The Fed is widely expected to cut interest rates by 25 basis points (bps) this week, lowering the federal funds rate target range to 4.25-4.50%.”
According to futures data, the probability of this rate cut follows a similar rate cut in November is 95%. While a rate cut appears to be priced in, markets will scrutinize the Fed’s Summary of Economic Projections (SEP) and its “dot plot” depicting the expected path of policy rates through 2025 and beyond.
any signal that Fed Potentially limiting the pace of future rate cuts – especially if it revise the dot-plot from four rate cuts in 2025 to three or even two – could put pressure on risk assets like Bitcoin and cryptocurrencies. Many analysts point to the ongoing softening of the labor market and easing housing inflation, as evidenced by slower rental price growth, as key arguments for further rate cuts.
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However, the Fed is likely to express a more cautious stance and highlight the risk of so-called “Trump inflation,” noting that the incoming Trump administration could reimpose trade tariffs that could push inflation higher. If this inflationary risk persists, the Fed may pause or slow the pace of rate cuts in 2025, which would be viewed as a hawkish move.
The new dot plot for 2025 is currently expected to show around 3.625% (the baseline assumption for three rate cuts next year), but there is speculation that this number could rise to 3.875% if the Fed becomes more cautious. Bitcoin’s immediate reaction may depend on the tone of the meeting, with a less dovish Fed potentially bringing volatility to Bitcoin price action.
#2 Phantom(FTM)
Fantom is entering a new era The upcoming Sonic L1 Mainnet launch, a revolutionary upgrade that will significantly improve network throughput and cost efficiency. The developers behind Fantom stress that Sonic is capable of processing approximately 10,000 transactions per second, almost instantaneously, which is a significant leap compared to current network capabilities.
The planned modifications also aim to cut operating expenses, reportedly reducing validator node costs by 66% and minimizing storage requirements. Another important detail is Fantom’s decision to maintain compatibility with the Ethereum Virtual Machine, which will allow EVM-based applications to migrate directly to the upgraded chain without modifying its underlying code.
Sonic will also launch a new token, designated S, which will replace the existing FTM token on a one-to-one basis.
Cryptocurrency trader Jacob Canfield said via It fits perfectly with the launch of SONIC.”
#3 Avalanche (AVAX)
Avalanche will become another focus for the crypto industry as Avalanche9000 upgrade It will be launched on the mainnet today (December 16). Previously, the testnet made its debut on the “Fuji” testnet on November 25th.
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Avalanche’s core developers describe the highly anticipated mainnet launch as the most significant upgrade in the chain’s history. Avalanche’s announcement on December 12 of a $250 million private token sale led by Galaxy Digital intensified the discussion. dragonflyParaFi Capital and more than 40 other entities participated.
According to an official statement, this round of financing strengthens Avalanche’s financial strength, and the company’s AVAX token value has reached approximately $3 billion, following a $230 million token sale in 2021.
Avalanche9000 combines the Etna Upgrade and key community proposals ACP-77 and ACP-125 to completely reimagine the functionality of the Avalanche subnet (now called Layer 1). In the process, Avalanche moved from an expensive validator system that cost 2,000 AVAX per instance to a more subscription-like model that charges 1.33 AVAX per month. The upgrade also focuses on cross-chain connectivity, enabling more complex inter-chain communications within Avalanche’s broader ecosystem.
#4 Stack (STX)
Stacks is another name that is getting a lot of attention as it prepares to launch sBTC on Tuesday, December 17th at 11:00 AM ET. This new BTC-backed asset aims to bring Bitcoin liquidity directly into the DeFi space on Stacks, offering a rewards program with no staking requirements.
According to the official introduction of the project announcementthe sBTC rewards program offers 5% annual Bitcoin rewards, paid out in biweekly installments, and distributions are made in actual Bitcoins rather than third-party tokens.
The first phase of the program will begin on December 17, focusing on deposit functionality and instant rewards for sBTC holders. The second phase, currently planned for March 2025, is expected to introduce more advanced DeFi features and reward structures, thereby expanding the utility of sBTC.
#5 Zero Level (ZRO)
LayerZero rounds out this week’s watchlist with a governance milestone. On December 20, 2024 at 00:00 UTC, ZRO token holders will participate in the network’s first-ever fee conversion referendum, which may activate protocol fees per LayerZero message.
this referendum Quite simply, the question is asked: “Turn on the fee switch?” Assuming a quorum is met and a majority votes “yes”, a fee will be enacted that matches the underlying DVN and executor costs per message, effectively Double the cost of each cross-chain transfer.
The fees collected will then be used to buy back and destroy ZRO, which may reduce the circulating supply and affect the economics of the token. ZRO balances on Ethereum, Optimism, Base, Polygon, Avalanche, BNB Chain and Arbitrum are all rolled into each holder’s voting rights and seamlessly integrated through LayerZero’s lzRead feature.
The referendum will last for seven days and end on December 27, 2024. A quorum of 60% of the circulating supply is required for a vote to be valid; if that threshold is not reached, the result defaults to “no”. If the referendum passes, protocol fees will be activated immediately, which could change the dynamics of how developers and users manage cross-chain communications.
This governance mechanism repeats every six months, but if quorum requirements are not met, it will be reduced by 5% each time, with a minimum of 20%.
At press time, Bitcoin was trading at $104,748.
Featured image created using DALL.E, chart from TradingView.com
