Different events that are about to take place could shake up the bitcoin (BTC) and cryptocurrency market, both downwards and upwards.
“In the short term, cryptocurrency markets are primarily focused on two catalysts,” notes exchange Coinbase in a new report. These are Donald Trump’s US presidential inauguration in a week and the ongoing FTX compensation distributions.
However, “the timeline for realizing the effects of such events is uncertain, putting broader macroeconomic considerations in the driver’s seat for now,” he mentions.
It states that some Possible announcements from the new US government, such as confirmation of a strategic bitcoin reserve, could provide an advantage for the market. But, he points out that cryptocurrency bets on Polymarket assign relatively low probabilities of that happening in the first 100 days.
There is a 26% probability that Trump will create a national bitcoin reserve in his first 100 days in office, according to bets, as shown in the following screenshot of the platform translated into Spanish.
Regarding cryptocurrency distributions to victims of FTX, an exchange that went bankrupt two years ago, these currently give priority to those under USD 50,000. Together, such operations represent a total of USD 1.2 billion, which is not a significant number to have a strong impact on the market if their recipients sell them, according to Coinbase.
With this outlook in consideration, “we are cautiously optimistic for the first quarter of 2025,” they confess from the exchange. He also attributes the enthusiasm to the growth in the capitalization of stablecoins at more than USD 2,000 million weekly.
“These stablecoin flows may focus on altcoins as market participants increase liquidity,” he clarifies. “At the same time, we believe that institutional interest, driven by positive post-election sentiment, can continue its momentum, which could support the market in the coming months,” the analysis adds.
Meanwhile, he maintains that broader macroeconomic backdrop shows mixed signals. The lower probability of interest rate cuts due to strong employment data and inflation risks may moderate the returns on risky assets in the short and medium term.
Still, for Coinbase, that narrative could change later in the year as monetary policy uncertainty subsides. “Until then, however, markets may experience further turmoil driven by a greater dispersion of interest rate expectations,” he says.
Current Bitcoin Prices Motivate Longtime Investors to Sell
According to the exhange, it is also worth considering that bitcoin supply may temper some short-term bullish expectations. Base this on the importance of current prices as a distribution/sales area for long-term holders.
The active supply of BTC (moved in the last three months) has skyrocketed from 2.7 million in October 2024 to 4.6 million now. “This is an indicator of a greater willingness among long-term holders to exit their positions around the USD 100,000 level,” he comments.
“These supply-side dynamics suggest there could be a period of consolidation for bitcoin in the coming months, similar to the on-chain signals we saw when it broke all-time highs in March 2024,” Coinbase concludes.
Meanwhile, as CriptoNoticias reported, bitcoin It has been trading in a wide range above USD 90,000 for two months. Its all-time high until then has been USD 108,000, a level reached a month ago, in mid-December.
