Bitcoin (BTC) has achieved a significant milestone by breaking above the $65,000 mark, a move that could potentially set the stage for a broader cryptocurrency rally in the last quarter of 2024. This optimistic forecast comes from Markus Thielen, head of research at 10x Research.
Sustained Bitcoin Rally Could Spark FOMO In Altcoins
In a recent detailed report, Thielen highlighted several pivotal factors that could fuel a crypto market surge in Q4 2024. The report suggests that further upside for the crypto markets could be imminent due to two primary factors: increased stablecoin minting and Bitcoin’s robust price movement.
Firstly, the acceleration in stablecoin minting indicates heightened interest among investors and traders in re-entering the crypto market. Following the Federal Open Market Committee (FOMC) meeting on July 31, approximately $10 billion worth of stablecoins were issued, thereby boosting market liquidity and surpassing Bitcoin exchange-traded fund (ETF) inflows.
The report underscores that Circle, a major player catering to more regulated institutions, has accounted for about 40% of recent stablecoin inflows. This suggests that larger market participants are increasing their allocations. Unlike USDT minting on the Tron network, which is typically associated with capital preservation, the minting of USDC may indicate a rise in decentralized finance (DeFi) activity. Year-to-date, stablecoin inflows have reached $35 billion, pushing the total value of outstanding stablecoins to an impressive $160 billion.
Thielen emphasizes Bitcoin’s recent breakout above $65,000, suggesting it could swiftly move towards the psychologically significant $70,000 level before attempting to set a new all-time high (ATH).
Additionally, another indicator pointing towards a potential altcoin rally is the declining Bitcoin dominance (BTC.D) following the September FOMC meeting. This decline in BTC.D coincides with rising Ethereum (ETH) network gas fees, likely driven by increased altcoin activity on the smart contract blockchain.
The rise in Ethereum gas fees, which surged from $1.89 million on August 13 to consistently hover above $7 million since September 22, further supports this trend.
The report also adds that, assuming the US Federal Reserve (Fed) continues to cut interest rates, high-beta altcoins could become increasingly attractive to crypto traders.
Encouraging Cryptocurrency Trends In South Korea, China
The report highlights the significant crypto trading activity in South Korea as a factor bolstering the altcoin trend. In South Korea, daily trading volume now hovers around $2 billion, with altcoins taking the lead over Bitcoin in trading activities.
Notably, Shiba Inu (SHIB) has reclaimed the top position in trading volume in South Korea, indicating increased speculation and setting the stage for a potential altcoin-dominated market in Q4.
Furthermore, Thielen points out that Chinese over-the-counter (OTC) brokers have reported consistent quarterly inflows of approximately $20 billion over the last six quarters, totaling $120 billion. This trend could further fuel the crypto market’s growth in the coming months.
Recently, the Chinese central bank reduced its reserve requirement ratio (RRR) by 50 basis points to inject liquidity into the market. This move could potentially trigger a parabolic rally in digital asset prices later this year.
The report concludes with a forecast that Bitcoin’s next target will be $70,000 within two weeks, with a potential new ATH by late October. As of the time of writing, Bitcoin trades at $66,298, up 1.4% in the past 24 hours.
Bitcoin looks poised to reclaim $70,000 on the daily chart, indicating a promising outlook for the cryptocurrency market in the near future.
