Crypto.com CEO Sees Rate Cut as Catalyst for Crypto’s Q4 Surge

Crypto.com CEO Kris Marszalek has forecasted that the Federal Reserve’s expected rate cut in September will spark a strong fourth-quarter for the crypto markets, citing historical trends and current market sentiment. Speaking with Bloomberg on Tuesday, Marszalek expressed confidence that the Fed would reduce interest rates at its Sept. 17 meeting, a move that typically benefits high-risk assets like cryptocurrencies by increasing liquidity and lowering borrowing costs. This aligns with the broader market view, with prediction markets showing a 91.7% probability of a rate cut following Fed Chair Jerome Powell’s Jackson Hole speech on August 22, which hinted at potential monetary easing.

Historical precedent supports this optimism: when the Fed cut rates between September and December of last year—from 5.5% to 4.5%—crypto markets gained 57% in that four-month span. Marszalek noted that Crypto.com’s revenue is likely to outperform in 2025, especially if the anticipated rate cut materializes, and a strong Q4 follows. He highlighted that the firm generated $1.5 billion in revenue and $1 billion in gross profit in 2024, with $700 million reinvested, and expects this year to bring even greater performance.

In addition to his bullish outlook on the broader market, Marszalek shared insights into the company’s strategic direction. While acknowledging the financial and reputational appeal of a potential IPO, he revealed that no decision has yet been made. “We have the numbers to do it, but we also enjoy being private,” he stated, adding that the firm is preparing for a public listing but has not committed to a timeline. He also highlighted Crypto.com’s plans to expand into the prediction markets space, with a focus on positioning itself as a key liquidity hub in the U.S.

This ambition aligns with the company’s recent partnership with Trump Media and Technology Group, which announced a $6.4 billion Cronos (CRO) treasury strategy on August 26. The initiative involves seeding the treasury with 6.3 billion CRO tokens, alongside $200 million in cash and $220 million in warrants, with a further $5 billion in equity line of credit available for future purchases. Following the announcement, CRO surged nearly 150% to $0.38, though it has since retreated to $0.27, down 72% from its 2021 all-time high. The partnership also includes the staking of CRO via Crypto.com’s custody platform to generate revenue and the integration of CRO as a utility token across Truth Social and Truth+.

Meanwhile, the company is expanding its footprint in the U.S. prediction market space through a collaboration with Underdog. The agreement enables Underdog users in 16 states—many of which lack legal sports betting—to trade on sports event contracts via a platform powered by Crypto.com Derivatives North America (CDNA), which is registered with the Commodity Futures Trading Commission (CFTC). This move positions Crypto.com as a key player in a rapidly evolving market, offering users a federally compliant way to engage with prediction contracts. Underdog’s CEO Jeremy Levine emphasized the significance of the partnership, stating that the future of prediction markets will be driven by sports and that Underdog is uniquely positioned to capitalize on this trend.

Despite regulatory uncertainties and pushback from state and tribal authorities, the prediction market industry is gaining momentum. Platforms like Kalshi and Polymarket have also entered the space, though with legal challenges, while traditional sportsbook operators like FanDuel and DraftKings are exploring similar opportunities. The potential market size for sports prediction contracts is substantial, with estimates suggesting it could reach $555 million in 2025, compared to around $16 billion for legal online sports betting in 2024.

Source: [1] Crypto.com Launches Industry's Most Rewarding Benefits (https://crypto.com/en/company-news/revamped-levelup) [2] Crypto.com CEO Predicts Strong Q4 On Fed Rate Cut Hopes (https://cointelegraph.com/news/crypto-com-ceo-bets-fed-rate-cut-fuel-crypto-markets-in-q4) [3] Cronos Blasts Off to 3-Year High After Trump Media's $6.4 (https://finance.yahoo.com/news/cronos-blasts-off-3-high-213528698.html) [4] Underdog and Crypto.com | Derivatives North America (https://crypto.com/en/company-news/underdog-crypto-com) [5] Underdog Bets on Prediction Markets With Crypto.com Deal (https://frontofficesports.com/underdog-bets-on-prediction-markets-with-crypto-com-deal/)