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How do compounded SOFR and term SOFR impact the value of digital currencies?

avatarChinaya BanarasDec 27, 2021 · 3 years ago1 answers

Can you explain how the compounded SOFR and term SOFR affect the value of digital currencies?

How do compounded SOFR and term SOFR impact the value of digital currencies?

1 answers

  • avatarDec 27, 2021 · 3 years ago
    As an expert in the field of digital currencies, I can tell you that the compounded SOFR and term SOFR can have a direct impact on the value of digital currencies. When these rates increase, it can signal higher borrowing costs for financial institutions, which may lead to a decrease in demand for digital currencies. Conversely, when these rates decrease, it can make digital currencies more appealing as an investment option. It's important for investors to consider the impact of these rates on the overall market sentiment towards digital currencies.