After seven months of consolidation, BTC spot ETFs have seen unusual inflows. Starting with a 50 basis point rate cut in mid-September, Fed Chairman Powell assured the market that the rate cut cycle would be extended, which further accelerated the inflow of funds into BTC spot ETFs.
BTC’s strong momentum is expected to continue into December, driven by rising prices and increased media attention, attracting new investors. Optimism also surrounds Trump’s inauguration on January 20, 2025, which could usher in a more favorable regulatory environment for cryptocurrencies, including the appointment of a new SEC chairman. In addition, expectations of FTX’s upcoming announcement of a $16.5 billion return to creditors may also support market sentiment. These factors create a favorable backdrop for continued bullish sentiment and BTC price stability.
By 2025, crypto assets will cross the 8% penetration threshold, which will be a major turning point and lay the foundation for greater popularity.
Among the factors that have driven BTC to new highs this quarter, three major changes in the US regulatory field are the most important. First, on December 6, S&P Global may announce the inclusion of MicroStrategy in the S&P 500 index, prompting index funds to enter the market. Second, on December 10, Microsoft will review a proposal to invest in BTC despite the opposition of the board of directors.
Previously, the National Center for Public Policy Research submitted a proposal based on the "2025 Plan" suggesting that BTC be evaluated as an investment target. Finally, starting from December 15, 2024, the Financial Accounting Standards Board (FASB) will introduce new regulations allowing crypto assets to be included in company financial reports at fair market value, which will encourage financial departments to include BTC in their balance sheets.
Historically, when BTC’s relative strength index (RSI) reaches overbought levels or a 30-day rolling return of more than 40% +, its price tends to consolidate as momentum cools. But given the recent overbought conditions, a brief consolidation phase may occur. However, many positive factors are gradually emerging.
Looking at Bitcoin’s current momentum from the 7-day rolling price change rate (based on USD), the absolute difference in price increases as BTC price rises, but the recent 7-day price increase of $19,265, a record high, also shows that this is an unprecedented rebound in strength.
Some of the above opinions are from Matrix on Target. Contact us to obtain the full report of Matrix on Target.
Disclaimer: The market is risky and investment should be cautious. This article does not constitute investment advice. Digital asset trading can be extremely risky and unstable. Investment decisions should be made after carefully considering personal circumstances and consulting financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.
