Recent data has been favorable, prompting Fed Chairman Jerome Powell to adopt a more moderate tone in his statements. As the year draws to a close, the trajectory for Bitcoin (BTC) and altcoins is becoming clearer. At the time of writing, BTC is valued at $63,700, with altcoins showing positive trends. Despite a minor drop triggered by the MTGOX transfer, the anticipated severe decline has not materialized yet.
2024 Year-End Crypto Projections
A revision in Fed members’ interest rate cut predictions for year-end has led to significant volatility in the cryptocurrency market. Germany’s sales activities and the U.S. Silkroad sale coinciding with MTGOX transfers have created a mixed market environment. Although there was a short-term Trump-supported surge, further changes could still be on the horizon.
FedWatch data indicates a 100% expectation of an interest rate cut by September. The market now fully anticipates a rate cut, contrasting with earlier, more conservative estimates. Investors initially expecting a 150 basis points cut at the start of 2024 were considered overly optimistic compared to the Fed’s anticipated 75 basis points cut.
Earlier in the year, the first quarter’s poor inflation data caused undue concern. However, the situation is improving. Latest inflation figures show a continued decline, raising the possibility of at least two rate cuts by year-end. This could boost risk appetite as the September meeting approaches.
September and November Crypto Insights
In 2021, Bitcoin set a new all-time high around this period. The reduced impact of MTGOX returns and the strengthening of ETH ETF entries are among the key factors bolstering optimism for the upcoming quarter. Here are several reasons supporting the expectation of a rise:
Key Inferences for Investors
- Trump’s anticipated November election victory, given his pro-crypto stance, could attract more voter support.
- The influence of MTGOX returns is predicted to fade by November.
- Post-launch sales effects in the ETH ETF channel are expected to subside, with steady net entries continuing.
- A major financial institution like Vanguard may soon offer BTC ETFs to their clients.
- The Fed is likely to implement its first rate cut.
The culmination of these factors paints a potentially positive outlook for cryptocurrency as we approach the final quarter of the year.