“A potential 50 basis point rate cut, floated by macro heavyweight Scott Bessent, is fueling a fresh leg higher in major cryptos including Ether, Cardano, and XRP.”

U.S. Treasury Secretary Scott Bessent’s unexpected push for a 50-basis-point rate cut sent altcoins soaring in late Tuesday trading, though Bitcoin’s muted response highlighted a growing divergence between blue-chip crypto and the rest of the digital asset market.

📈 Altcoin Breakout Accelerates

Major altcoins surged following Bessent’s comments, with notable gains including:

Ether (ETH): +9% to break above $4,600 for the first time since 2021
Cardano (ADA), Solana (SOL), Litecoin (LTC): Each up ~8%
XRP: +3.5%, continuing its recent consolidation breakout

🗣️ The Bessent Catalyst

In a Fox News interview, the Treasury Secretary argued:

The Fed should consider a 50 bps cut in September (exceeding the priced-in 25 bps)
Faulted inaccurate data for preventing a June cut, calling it a “foundational issue”
As the official tasked with selecting the next Fed Chair, his views carry market-moving influence

₿ Bitcoin’s Surprising Lag

Despite the broad-based rally, Bitcoin’s performance was notably subdued:

Flat over 24 hours at ~$120,000 despite risk-on momentum
Trading volume well below average as institutional flows favored altcoins
Continued underperformance suggests capital rotation, not broad crypto strength

🌍 Broader Market Context

Equities: Rose over 1% post-CPI, supporting the soft landing narrative
Dollar: Weakened against major currencies, boosting risk assets
Volatility: Compressed across markets as rate certainty increased

⚠️ Key Tensions to Watch

Fed Credibility: Will policymakers push back against Bessent’s comments?
Bitcoin Leadership: Is BTC’s lag temporary or a sign of altcoin dominance?
September FOMC: Markets now price 31% odds of a 50 bps cut (up from 12%)

💡 Why This Matters

Bessent’s remarks reinforce the administration’s dovish stance and suggest deeper structural concerns about economic data. For crypto markets, the reaction reveals:

Altcoins remain more sensitive to macro liquidity expectations
Bitcoin may be facing unique headwinds (e.g., ETF outflows, regulatory uncertainty)
Traders are increasingly willing to rotate into higher-beta crypto assets