With Trump winning the US elections the day before yesterday, today (November 8), the Fed lowered the benchmark interest rate by 25 basis points to 4.50%-4.75% (the second rate cut of the year, in line with market expectations), market sentiment continues to soar, and Bitcoin has continuously broken historical highs reaching 76,990 dollars.
Although the results of the US elections will have a long-term impact on the crypto market, we should not ignore the short-term volatility risks. In this week’s fluctuating Bitcoin rally, just in the past 24 hours, the total liquidation amount in the crypto market exceeded 348 million dollars, with more than 96,000 people being liquidated. Meanwhile, the open interest for Bitcoin on exchanges has reached a historical high of 46.6 billion dollars, which usually indicates that there may be greater volatility or that the short-term has reached a peak. Please do not FOMO and try to stay away from leverage.
In a previous article (November 5), we mentioned that the crypto market has never lacked hot topics; almost every period, a new important event becomes the focus of attention and discussion. Now, with the US elections in November and the Fed's second interest rate cut expectations materializing, people will soon begin to search for or focus on the next new event.
From a short-term perspective: the reason Bitcoin's price can break historical highs is mainly due to the emotional impact of Trump winning the US elections, which we have elaborated on in previous articles. At this stage, the leverage in the crypto market has significantly increased, so we cannot rule out the possibility of short-term adjustments.
From a medium to long-term perspective: As we envisioned in previous articles, with Bitcoin's breakthrough, a new round of bullish market has arrived. Although there may be some adjustments in the short term, this is normal because the market cannot rise in a straight line; there will always be some adjustments. However, if you are still on the sidelines at this stage, waiting for Bitcoin to drop below 40,000 dollars to buy the dip, then you will likely continue to miss this bull market.
So, what is the maximum price Bitcoin can reach in this bullish market?
Actually, we have been thinking and speculating on this issue intermittently since 2022. Although personally, I am reluctant to discuss any market predictions or price forecasts too much, as a blogger, I know that many people (especially newcomers) enjoy seeing this kind of content, so I will occasionally do market analysis or price predictions (guesses).
As for the price of Bitcoin, for example, in the article dated February 14, 2024, we made some simple thoughts on the market trend from four different dimensions. At that time, we further made a subjective prediction of BTC's price, leaning towards a range of 100,000–120,000 dollars, and this range will also be where I start to consider selling in batches. As shown in the image below.
Of course, we still hold the old saying that the market is unpredictable. All so-called predictions are merely guesses made by different people based on historical experience and data. The logical point here is not to look at what others say, because everyone's risk preferences, positions, and personal experiences are different. You should make reasonable planning and strategy formulation based on your own situation.
Currently, we maintain our personal expectation (guess) that Bitcoin will reach 100,000–120,000 dollars in this cycle, but with Trump's victory leading to a rapid breakthrough of Bitcoin's historical highs, combined with Trump (and also, over 270 candidates supportive of cryptocurrencies have gained congressional seats this week) potentially taking some new positive measures towards the crypto market (for example, making BTC a strategic reserve asset for the US), along with the Fed's continued interest rate cuts, we even believe Bitcoin may reach as high as 150,000 dollars next year (2025).
So, what is the highest price Ethereum can reach in this bullish market?
As mentioned above, if Bitcoin really can rise to over 150,000 dollars next year, then optimistically guessing, ETH has a great chance of reaching 12,000 dollars, and SOL may have a chance to exceed 450 dollars. Some altcoins theoretically could also have 5–10 times the space. If we speculate based on our previous Bitcoin range of 100,000–120,000 dollars, then the possible price for ETH is 8,000–10,000 dollars, and for SOL, it could be 300–400 dollars. Of course, this is merely a personal guess based on Bitcoin's fundamentals and not intended as any investment advice.
At the same time, we will also see some positive influencing factors from other aspects, such as:
- Rise of Coinbase stock
With Trump's victory, the suppressed demand seems to have been significantly reflected. Although traditional off-market funds may not consider participating directly in the crypto market for some reasons, the recent rise in Coinbase's stock can illustrate some issues. As shown in the image below.
Aside from the performance of Coinbase's stock, we need to further consider that because Coinbase (including the Base chain) and its derivatives (such as staking and DeFi) are fundamentally closely linked to Ethereum, from a price expectation perspective, although ETH's price is lagging behind Coinbase's performance, it may gradually eliminate this gap in the near future.
Moreover, don’t forget that currently ETH is still the only tool with ETF products besides BTC. At this stage, Bitcoin is continuously creating historical highs, and Solana also broke its historical high today (November 8), while ETH is also worth looking forward to.
- CEX is experiencing a large inflow of stablecoins.
On the day after the US elections, the inflow of stablecoins into exchanges like Binance and Coinbase reached a cumulative total of 9.3 billion dollars, making it the second largest inflow of ERC-20 stablecoins since their inception. Generally, this is a very positive sign, as a large portion of this capital may be used to purchase BTC or altcoins. As shown in the image below.
Historically, the large inflow of funds from September 2020 to February 2021 coincided with a bullish rebound. If history can repeat itself, then the current large inflow may similarly trigger a rising trend, and the crypto market may experience another bullish rebound.
Additionally, we must mention the issue of MemeCoin again. In a previous article, we noted that the trend of MemeCoin seems to be at a phase peak, and perhaps we will soon see the possibility of rapid rotation of some altcoin narratives.
As Bitcoin continues to break historical highs this week, I notice that some projects under the DeFi category are indeed rebounding well, such as UNI, AAVE, etc. As shown in the image below.
Previously, due to some regulatory pressure from the SEC, many altcoins, except for BTC, were considered to have the nature of securities, which made it difficult for many altcoins to be traded normally in the US market. However, with Trump's assumption of office, perhaps there will be some new changes to these issues.
We expect that before the first or second quarter of 2025, some altcoins may regain attention and speculation, and some liquidity from MemeCoin may flow back into altcoin narratives. However, due to the uniqueness of this round of MemeCoin narratives, we may continue to see a few stories of wealth from memes (i.e., a handful of MemeCoins will continue to rise), but the probability of a large-scale MemeCoin cycle explosion will significantly decrease.
In summary, from a medium to long-term perspective, we will continue to maintain an optimistic attitude towards the overall development of the market. Regardless, we firmly believe that Bitcoin will eventually exceed 100,000 dollars. However, you should also pay attention to short-term volatility; this week or in the coming weeks, with the elections and interest rate cut expectations materializing, the market may experience sideways consolidation or short-term declines.
It seems that everyone can make money in a bull market, but many people often end up losing in the later stages of the bull market. Be sure to have your own plan and position management; if it is a short-term operation, pay attention to taking profits and cutting losses. If you are still on the sidelines and want to seize the last opportunity of this bull market, then you need to seriously think and adjust your strategy, as bull markets do not last forever.
