This week is a crucial one for the crypto market, with several important events on the horizon. These events include the release of the FOMC minutes, EigenLayer updates, and the introduction of the new Arbitrum staking initiative.
Investors and observers are paying close attention to these events to assess their potential impact on asset prices and overall financial movements. Let’s take a closer look at what lies ahead.
FOMC Minutes Approach: What’s Next for Bitcoin and the Crypto Market?
The Federal Open Market Committee (FOMC) will release its minutes on August 21 at 2:00 p.m. ET. At its previous meeting in July, the FOMC decided to keep the federal funds rate at 5.25% to 5.50%. That decision was in line with market expectations and underscored the Fed’s cautious approach to inflation.
Fed Chairman Jerome Powell has hinted at a possible rate cut if inflation continues to trend lower. The market has priced in a potential rate cut in September, with more cuts expected by the end of the year.
Historical data from 10x Research shows a strong correlation between Bitcoin’s performance and inflation trends. Typically, Bitcoin rises when inflation declines, and vice versa. At the time of writing, Bitcoin is trading at $58,575, reflecting a 1.45% decline over the past 24 hours.
Arbitrum’s New Staking Proposal with the stARB Token
On August 16, the Arbitrum Decentralized Autonomous Organization (DAO) approved a proposal to introduce ARB staking for Ethereum layer-2. The proposal received overwhelming support, with 91% of those who voted in favor of the initiative.
By implementing ARB staking, the governance will only actively use about 10% of the current circulating supply of ARB tokens — roughly 100 million ARB out of the 1 billion in circulation. This new initiative aims to increase voter participation and ensure that the DAO’s decision-making process is more secure and representative of the broader community.
The staking mechanism will introduce a liquid staking token, stARB, which will offer auto-compounding features and compatibility with various DeFi protocols. Initial staking rewards will be transferred from multiple sources generated by the DAO, such as sequencer fees, MEV fees, validator fees, token inflation, and treasury diversification. The launch of this staking system is expected to begin in late August, with further updates and specific timelines to be provided in the coming weeks.
EigenLayer Expands Support for ERC-20 Tokens
EigenLayer, a well-known restaking protocol, has announced the upcoming release of permissionless token support on its mainnet. The update, expected this week, will allow users to restake any ERC-20 token, expanding the assets that contribute to the security of decentralized networks.
“This feature is currently on testnet for a short permissioned testing phase. EigenDA will be the first AVS to test and use permissionless token support. The mainnet rollout, a protocol-level upgrade, is scheduled for [this] week. UI support for restakers will be added later in Q3,” the EigenLayer team said.
This expansion marks another milestone for EigenLayer, which continues to dominate the DeFi market. At the time of writing, DefiLlama data shows that EigenLayer is the second-largest DeFi protocol with a total value locked of about $12.4 billion.
Babylon Begins Phase 1 of Its Bitcoin Staking Mainnet Launch
This week, Babylon, a Bitcoin staking protocol, will begin Phase 1 of its Bitcoin Staking Mainnet launch. This phase allows Bitcoin holders to begin locking up their BTC for staking in a secure, self-serve environment. Stakers can delegate their voting rights to a finality provider with the ability to unlink their stake before it expires.
The initial staking limit is set at 1,000 BTC, with strict transaction size limits to encourage widespread participation. While no direct staking rewards will be distributed at this stage, a points system will track staker activity. This system is designed to lay the groundwork for future staking phases.
AVAX and other major tokens to be unlocked this week
This week will also see significant token unlocks worth over $230 million, with the largest being Avalanche’s release of 9.54 million AVAX tokens worth over $197 million. This unlock could impact the asset’s price, especially since no additional tokens will be allocated to the team or strategic partners after this event.
Other major token unlocks include Space ID (ID), PIXEL, and Ethena (ENA). Read this article for more details on this week’s major crypto token unlocks.
