Bitcoin‘s price remains below $44,000, with altcoins turning red as profitable investors sell off. On-chain metrics have reached levels that previously triggered downturns, and historical data suggests markets may be pulled down by high profitability. However, finding support at higher levels is crucial for BTC during these corrections.
Spot Bitcoin ETFs have reached a total of $7.6 billion yesterday and today, with over $600 million in net inflows on the launch day. Only 13 days into 2024, investors anticipate numerous events throughout the year. BlackRock, the world’s largest asset manager, has shared three predictions that could bolster crypto markets in 2024.
At the onset of 2024, BlackRock expects continued macro variability and high market volatility, characterized by a positive stock-bond correlation and core inflation above target. This environment suggests significant movements for cryptocurrencies.
The Federal Reserve is anticipated to begin rate cuts this year, potentially reducing rates by over 150 basis points by the end of 2024. However, the current expectation is for a 75 basis point cut if conditions align, indicating the market’s overly optimistic stance. BlackRock experts foresee several developments that could impact cryptocurrencies in 2024.
Persistent inflation could continue to affect investor sentiment towards assets like cryptocurrencies, traditionally seen as inflation hedges. The sustainability of the U.S. dollar amidst fiscal concerns raises questions about the appeal of cryptocurrencies as alternative assets. Europe’s market potential, with optimistic views on earnings growth and consumer spending, could indirectly influence the crypto market through broader economic impacts and global investment flows. BlackRock CEO Fink has expressed belief in cryptocurrency as an asset class and anticipates growing interest in the RWA space, suggesting that citizens in high-inflation countries may show increased interest in this area.