How does the SOFR base rate affect digital asset prices?

1 answers

• Ernesto Garcés GinerJun 04, 2024 · a year ago
  At BYDFi, we closely monitor the impact of the SOFR base rate on digital asset prices. While the relationship between the two is not direct, changes in the SOFR base rate can indirectly affect investor sentiment and market dynamics, which in turn can influence the prices of digital assets. Higher interest rates resulting from an increase in the SOFR base rate can make traditional investments more attractive compared to digital assets, leading to a potential decrease in their prices. Conversely, a decrease in the SOFR base rate can make digital assets relatively more appealing, potentially driving their prices up. It's important for investors to consider the broader economic and market factors when analyzing the impact of the SOFR base rate on digital asset prices.
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