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The crypto ecosystem is on the verge of another important week, brought about by major developments taking place across different networks. This week’s spotlight falls on Bitcoin, Fantom, Avalanche, Stacks, and LayerZero, each facing a milestone. The broader background is also important, especially the decision of the Federal Open Market Committee (FOMC) of December 18 in the United States.
#1 Bitcoin And Crypto 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 Chair Jerome Powell’s press conference to follow at 2:30 pm ET. Saxo Bank writes in their latest investor note, “The Federal Reserve is widely expected to deliver a 25 basis point (bps) rate cut this week, lowering the federal funds rate target to 4.25-4.50%.
According to future data, there is a 95% probability of this move, which follows the same cut in November. While the rate cut appears to be priced in, the market will scrutinize the Fed’s Summary of Economic Projections (SEP) and the “dot plot,” which shows the expected path of policy rates through 2025 and beyond.
Any signal that the Federal Reserve may limit the pace of future cuts—especially if it revises the dot plan from four rate cuts in 2025 down to three or two—could weigh on vulnerable assets like Bitcoin and cryptocurrencies. Many analysts point to the labor market, which continues to soften, and the reduction in shelter inflation, evidenced by lower rental price growth, as key reasons for further devaluations.
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However, the Fed may convey a more cautious stance and highlight the so-called “Trump-flation” risks, referring to the possibility of renewed trade tariffs under the incoming Trump administration that could push inflation higher. If such inflationary risks remain persistent, the Fed may pause or slow down the pace of tapering in 2025, which would be considered a hawkish twist.
The new dot structure for 2025 is currently expected to show around 3.625% – the basic assumption of three rate cuts next year – but the market has speculated that this could move to 3.875% if the Fed is more cautious. The current reaction to Bitcoin will likely depend on the tone of the meeting, with a small Fed that may introduce volatility to BTC price action.
#2 Fantom (FTM)
Fantom enters a new era with the upcoming launch of the Sonic L1 mainnet, a revolutionary upgrade that will dramatically improve network performance and cost efficiency. The developers behind Fantom highlighted that Sonic is capable of processing up to 10,000 transactions per second, which is almost instantaneous—a marked leap from current network capabilities.
The proposed changes are designed to reduce operational costs, with a reported 66% reduction in validator node costs and reduced storage requirements. Another important detail is Fantom’s decision to maintain compatibility with the Ethereum Virtual Machine, which should make it clear that EVM-based applications can migrate to the development chain without changing their underlying code.
Sonic will also issue a new token, denoted S, which will replace the existing FTM token on a one-to-one basis.
Crypto trader Jacob Canfield said of X, “You shared this x reset last week, but FTM is nearing a price recovery break. It needs to clear the bearish impulse base and close the 4-hour candle and we will probably see a quick price recovery .The chart goes well with SONIC’s presentation.”
#3 Avalanche (AVAX)
Avalanche will be another focus area for the crypto industry, as the development of Avalanche9000 is scheduled to go live on the mainnet today, December 16. This follows the start of the testnet on the testnet “Fuji” on November 25.
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The highly anticipated mainnet launch is described by Avalanche’s core developers as the most important development in the series’ history. Adding to the buzz is Avalanche’s December 12 announcement of a $250 million private token sale led by Galaxy Digital, Dragonfly, and ParaFi Capital, with more than 40 other participating organizations.
According to official statements, this round of fundraising strengthens Avalanche’s coffers, which already have an estimated value of $3 billion in AVAX tokens, and comes after the previous token sale of 230 million in 2021.
Avalanche9000 includes the Etna Upgrade and key community proposals ACP-77 and ACP-125, all rethinking the way Avalanche subnets work—now called layer-1. In doing so, Avalanche transitions from an expensive verification system that requires 2,000 AVAX per instance to a subscription-like model that charges 1.33 AVAX per month. The development also focuses on cross-chain connectivity, enabling complex interchain communication within the wider Avalanche ecosystem.
#4 Stacks (STX)
Stacks is another name to keep on the radar as it prepares to launch sBTC on Tuesday, December 17, at 11:00 am ET. This new BTC-backed asset is designed to bring Bitcoin liquidity directly to the DeFi sphere on Stacks, offering a reward system with no significant requirements.
According to the official announcement of the project, the sBTC Rewards Program provides an annual Bitcoin reward of 5%, which is paid in two weekly installments, and the distribution is made with real Bitcoin, not third-party tokens.
The first phase of the program, which starts on December 17, will focus on deposit performance and immediate rewards for sBTC holders. The second phase, currently scheduled for March 2025, is expected to move to more advanced DeFi capabilities and reward structures, thus expanding the use of sBTC.
#5 LayerZero (ZRO)
LayerZero puts together a weekly watch list for management milestones. On December 20, 2024, at 00:00 UTC, ZRO token holders will participate in the first ever exchange network poll, a vote that will activate the protocol currency for all LayerZero messages.
The referendum is straightforward, raising one question, “Turn on the pay switch?” A “Yes” majority vote, assuming the total amount is reached, would authorize a charge equal to the basic cost of DVN and Nesabi Sefa for each message, effectively doubling the cost of each cross-chain transfer.
The funds raised will then be used to buy and burn ZRO, potentially reducing the circulating supply and impacting the token’s economics. ZRO balances across Ethereum, Optimism, Base, Polygon, Avalanche, BNB Chain, and Arbitrum are all included in each owner’s voting power, seamlessly integrated with lzRead’s feature LayerZero.
The referendum will last seven days, ending on 27 December 2024. A quorum of 60% of the votes cast is required for a vote to be valid; if that threshold is not reached, the result automatically changes to “No.” If the referendum passes, the protocol currency will be immediately unlocked, changing the dynamics of how developers and users manage cross-chain communication.
This regime is scheduled to repeat every six months, although the quorum requirement will drop by 5% each time it is not met, down to a minimum floor of 20%.
At press time, Bitcoin traded at $104,748.
The featured image was created with DALL.E, a chart from TradingView.com
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