This week is the last "super central bank week" of the year in Europe and the U.S., with several central banks including the Federal Reserve, Japan, the UK, and Sweden holding meetings in the same week. The probability of the Federal Reserve cutting rates by 25 basis points in December is 96%. Market focus has shifted to the content of Fed Chair Powell's speech and the latest economic projections, providing guidance for the direction of Fed monetary policy in 2025.
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CoinDesk reports that the UK Financial Conduct Authority (FCA) stated in a document released on Monday regarding the upcoming cryptocurrency regulatory framework that new legislation will prohibit public offerings of cryptocurrencies. This measure will be implemented based on existing rules in the UK, which prohibit unregistered cryptocurrency companies from promoting to UK customers. Only cryptocurrency trading platforms and related issuances that meet exemption criteria may be exempt from this restriction. The policy is still seeking industry feedback, especially regarding market access, information disclosure, and market abuse. This is one of several documents released by regulators in preparation for the cryptocurrency regulatory framework. Scripps News reports that the FBI's 2023 cryptocurrency fraud report indicates that complaints related to cryptocurrencies account for only about 10% of total financial fraud complaints, but the amount stolen accounts for nearly 50% of total losses. Coinglass data shows a cumulative net outflow of 37,708.42 BTC from CEX in the past 7 days. Santiment data shows that miners have sold over 140,000 BTC so far in December. DefiLlama data shows that the total market value of stablecoins has reached $192.7 billion, with an increase of 2.52% in the past week. The American financial services company Robinhood's 2024 year-end report shows that by November 2024, the value of cryptocurrency held by Robinhood was $38 billion, with the number of cryptocurrencies increasing to 20. Bloomberg reports that approximately 30 payment companies have obtained digital token service licenses issued by the Singapore central bank, and about 40% of Singapore investors own cryptocurrencies. With Trump returning to the White House and promising to open a new era that supports cryptocurrencies, it may bring returns to Singapore in 2025. Bitfine's report states that BTC has risen 130% year-to-date, and the current bull market reflects strong institutional demand, primarily driven by ETF and spot accumulation.
Historical data shows that during the mid-cycle, the market may peak between the third and fourth quarters of 2025, approximately 450 days after the halving, with corrections during this period remaining moderate, thanks to the inflow of ETFs and institutional funds. Indicators such as MVRV, NUPL, and bull-bear market cycle indicators show that it is still in a bull market phase but has not yet reached an excessively optimistic peak. The cycle top and four-year moving average model predict the potential cycle top price to be between $145,000 and $189,000. Historically, diminishing returns are adjusting the gains seen by BTC in previous cycles. Matrixport states that in the 2024 BTC bull market, ETH seems to be lagging behind the market, and 2025 may be a key turning point for ETH. The inflow of ETH ETF funds is performing strongly, which may attract traditional financial institutions to accelerate their entry and increase their holdings of ETH, achieving a strong rebound in the future. Coinshares weekly report shows that digital asset investment products saw a total inflow of $3.2 billion last week, marking the tenth consecutive week of net inflows, with a total inflow of $44.5 billion year-to-date. Since the U.S. elections, inflows into BTC investment products have reached $11.5 billion. ETH ETF saw an inflow of $855 million last week, reaching a historical high for weekly net inflows. Among them, BlackRock's ETHA inflow was $523 million, with a historical total net inflow of ETHA reaching $3.2 billion. Currently, the ETH spot ETF has a scale of $13.783 billion. MicroStrategy founder Michael Saylor stated that MicroStrategy has increased its holdings of BTC, with a total value of about $1.5 billion at an average price of approximately $100,386.
QCP report states that MicroStrategy has been included in the Nasdaq 100 index, adding momentum to market sentiment. This inclusion may trigger passive fund inflows into MicroStrategy's stock, indirectly making it easier for the company to raise funds to purchase BTC. GCash director Luis Buenaventura stated that this month's Fed rate cut expectations have been digested by the market in advance, and the direct impact on cryptocurrency prices will be limited. Historical data shows that when BTC experiences a 50% increase within 60 days, there is about a two-thirds probability of achieving an additional 35% increase in the following two months. Kronos Research director Neal Wen stated that in a low interest rate environment, institutional investors tend to view crypto assets as an alternative to traditional investments. This week is the last "super central bank week" of the year in Europe and the U.S., with several central banks including the Federal Reserve, Japan, the UK, and Sweden holding meetings in the same week. The Bank of Japan may pause interest rate hikes, and the Bank of England may pause rate cuts. Goldman Sachs believes that the Fed's rate cut in December is a foregone conclusion, with consecutive cuts of 25 basis points in January and March, followed by cuts in June and September. However, there is a risk of pausing rate cuts at the January meeting. JPMorgan predicts that the Fed will cut rates by 25 basis points in December and once every quarter in 2025. A Financial Times survey in the UK shows that economists have raised their forecasts for next year's federal funds rate, with the vast majority of respondents believing that by the end of 2025, the rate will hover around 3.5% or higher (currently 4.5-4.75%). European Central Bank President Christine Lagarde stated that recent signs indicate a significant decline in service sector inflation, and the ECB's direction is clear, with further reductions in key interest rates expected.
Goldman Sachs economist Scott Rubner believes that the rise of the U.S. stock market in 2024 is expected to continue into 2025. U.S. corporations have already approved stock buybacks worth $1 trillion for 2025, which may also drive the stock market up. With the market pricing in a 97% probability of the Federal Reserve cutting interest rates at the December meeting, the S&P 500 index is expected to rebound in the last few trading days of 2024. In the past week, U.S. stock funds saw a net inflow of $6.36 billion, and over the past nine weeks, the U.S. stock market recorded an inflow of $186 billion. Among them, after a net inflow of $121.33 billion into U.S. money market funds in the previous week, there was a net outflow of $2.67 billion last week. Some people are also paying attention to when the approximately $7 trillion in U.S. money market funds will loosen in a "low interest rate" environment, flowing into so-called risk assets such as the U.S. stock market, gold, and cryptocurrency markets. UBS analyst Jason Draho believes that before Trump takes office on January 20, the expected risk events are relatively few, and unexpected events cannot be defined, making it easy for the rebound to continue into the first quarter. BTC rose to $107,000, ETH reached $4,100, and Trump-related addresses have repeatedly increased their holdings in ETH and other cryptocurrencies, leaning towards the RWA concept (the reason for RWA may be the self-justifying claim of "using cryptocurrency to make up for the U.S. $35 trillion national debt," which is an obviously false promise). In this bull market, more consideration is given to where it will rise to, with a high probability of rising to a Federal Reserve interest rate between 3.0-3.5%, or even below 3.0%. The Nasdaq has returned to 20,000 points, BTC has hit a new high, and the leading altcoin ETH has started to follow suit, with the next wave likely to see other altcoins catch up. The flow of funds in the bull market goes from the U.S. stock market to the cryptocurrency market, from BTC to ETH and then to other currencies, exchanging time for space, maintaining optimism in the bull market.