Latest research from Matrix Research Institute indicates the following key focuses for the upcoming week:
– The decrease in the US inflation rate may lead to an increase in BTC as ETF funds flow back in.
– Perpetual contract investors are positioning themselves in anticipation of the potential launch of ETH ETFs.
– Trump hopes to gain more votes by supporting cryptocurrencies, resulting in an increase in Trump-themed meme coins.
Matrix Research Institute’s analysis shows that there is an increased correlation between CPI and BTC prices. If the next CPI data is lower than 3.3%, BTC is expected to reach a new all-time high. After 24 years, BTC’s price performance in January was slightly weak, followed by a strong surge in March, and has entered a consolidation phase in the past two months. With the approval of BTC ETFs, the price of BTC is now driven more by macro factors, with CPI being one of them.
Data shows that there is a correlation between BTC ETF market inflows/outflows and CPI. In January, the CPI index reached 3.4%, higher than the expected 3.2% and the previous month’s record of 3.1%, resulting in outflows from GBTC ETF. In February, the CPI index was 3.1%, lower than the expected 3.4%, leading to a gradual recovery and acceleration of BTC ETF inflows. In March, the CPI was 3.2%, causing the inflow of BTC ETF funds to stop. In April, the CPI exceeded expectations at 3.5%, causing BTC to drop to $60,000, and further declining to around $56,500 on April 30 due to weak ETF fund flows in Hong Kong. In May, the CPI was 3.4% (lower than the previous month’s 3.5% but in line with expectations), resulting in a rebound in Bitcoin. If the inflation index reaches 3.3% or lower in June, BTC prices are expected to reach new all-time highs, providing momentum for net inflows into BTC ETF markets.
Additionally, the seasonal trend in June is relatively positive, with an average return rate of 4%+, and July is even stronger with an average return rate of 8%+. Therefore, benefiting from positive seasonal factors, Bitcoin is expected to achieve a growth rate of more than 12% in the next two months.
In the market for ETH perpetual contracts, there has been an increase in inflows, indicating a lack of confidence in a significant rise in ETH after the launch of ETH ETFs. Market data reflects investors’ views on ETH ETFs. After the SEC approved the first part of the ETF application, the market saw a rapid increase in inflows of $4 billion into ETH perpetual contracts. Based on historical experience, investors may profit from long positions in Ethereum before the ETH ETFs start trading, as prices usually decline after the launch of new products. According to Grayscale’s latest report, the initial valuation of ETH ETFs is relatively high, and the price increase is limited compared to BTC ETFs launched earlier this year.
The political attributes of cryptocurrencies have become more prominent, and the attitude of the next government towards this emerging digital asset will be crucial. A survey conducted by Grayscale on the second phase of the 2024 US election showed that due to geopolitical tensions and inflation factors, an increasing number of voters are turning to Bitcoin, with support reaching 41%. 47% of voters expect their investment portfolios to include cryptocurrencies, higher than the 40% at the end of last year. Approximately 32% of voters expressed willingness to learn about cryptocurrencies as investments.
Combined with the SEC’s approval of ETH ETFs, cryptocurrencies have become an issue that both parties cannot ignore, and the attitude of the next government towards this emerging digital asset will be crucial. Currently, both powerful competitors in the presidential election have shown a favorable attitude towards cryptocurrencies and actively created related topics. The political attributes of cryptocurrencies are increasing. In a report released by Matrixport on May 10, 2024, titled “Trump Could Be the Biggest Boost for Bitcoin This Year,” it is predicted that if Trump, who supports economic growth and is friendly towards cryptocurrencies, is leading in the polls as the November 2024 presidential election approaches, it may drive an increase in the price of BTC.
The market value of Trump-themed meme coin (Trump-USDT) has tripled in just three weeks. The most popular Trump-themed meme coin (Trump-USDT) has seen its market value increase threefold in a short period of three weeks, reaching $600 million. As mentioned in our report last week titled “US Political Landscape Shifting Towards Support for Cryptocurrencies,” not only Trump and Republicans but also Democrats, as well as President Biden and the White House, are seen as supportive of cryptocurrencies. BTC has performed exceptionally well in US election years (2012, 2016, and 2020) with an average increase of 192%, and the US stock market has also performed well. With the popularity of Trump-themed meme coins (Trump-USDT), it is possible that more meme coins in the series will emerge in the future.
The above viewpoints are derived from Matrix on Target. Please contact us to obtain the complete report from Matrix on Target.
Disclaimer: The market carries risks, and investments should be made with caution. This article does not constitute investment advice. Digital asset trading can be highly risky and volatile. Investment decisions should be made after careful consideration of individual circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.