How does the three-month term SOFR affect the cryptocurrency market?

1 answers

• Dec 15, 2021 · 3 years ago
  At BYDFi, we closely monitor the impact of the three-month term SOFR on the cryptocurrency market. As a benchmark interest rate, SOFR influences the cost of borrowing and affects market liquidity. Changes in SOFR can lead to shifts in investor sentiment and trading strategies. For example, if the three-month term SOFR rises, it may prompt investors to seek higher-yielding assets, potentially diverting funds away from cryptocurrencies. Conversely, a decrease in SOFR could make cryptocurrencies more attractive as an investment option. Understanding the relationship between SOFR and the cryptocurrency market is crucial for making informed investment decisions.
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