At the end of 2024, the cryptocurrency market welcomed Christmas with significant volatility. Bitcoin (BTC) attempted to reclaim the $100,000 milestone after slipping below $93,000, but only peaked above $99,800 before rapidly dropping to around $95,000, marking a 3.1% decline in 24 hours. The broader CoinDesk 20 index also fell by 4.2%, with many major cryptocurrencies like ETH, SOL, XRP, ADA, and AVAX recording losses of 4%-7%.
In the context of low trading volume over the past 48 hours, Bitcoin has still more than doubled in value year-to-date. However, the yield on the 10-year bond has risen, currently at 4.63%, indicating that the favorable impact from rate cuts may be reversing, raising concerns that if the Fed continues to discuss rate cuts, it could lead to higher bond yields and market instability.
Macroeconomic researcher Jim Bianco highlighted the unprecedented rise in long-term yields following the Fed's recent cuts as a key factor to watch. Bitcoin's dominance ratio is approaching 60% as the price of the coin remains stagnant at the end of 2024, leading traders to consider shifting their focus to altcoins, with the view that altcoins offer better risk/reward ratios.
According to cryptocurrency trader Dyme, many investors have used dollar-cost averaging (DCA) strategies to buy cryptocurrencies, but he believes the ideal time to implement DCA into Bitcoin may have passed at least 1.5 years ago. Nevertheless, Dyme and others predict a promising future for altcoins like Dogecoin and Solana in 2025.
Some industry experts, such as Blockchain Association CEO Kristin Smith, assert that Bitcoin still has significant growth potential, forecasting a price of $200,000 before dropping to $50,000. The upcoming Trump administration and the rise of retail financial advisors recommending Bitcoin could bring new investment flows to the market.
Overall, although there are differing opinions on Bitcoin's future, many speculate that a shift towards altcoins may provide short-term benefits.
