BTC down Monday after climbing past $69K. What’s next?
Safe-haven assets are in demand as conflict continues in the Middle East and concerns about a global growth slowdown persist, analysts note
Digital abstract Art/Shutterstock and Adobe modified by Blockworks
Bitcoin hit roughly $69,400 over the weekend before retreating slightly as wars rage on and the US election approaches.
The asset’s price stood at roughly $67,600 at 4:30 pm ET — down about 2% on the day but up more than 7% from a week ago.
BTC is about 8% off its all-time high price of more than $73,000 set in March.
Compass Point analysts Joe Flynn and Ed Groshans said in a Friday research note they expect a new price peak for the asset in the coming weeks or months.
The factors leading them to that conclusion include increasing stablecoin liquidity; investors front-running $10 billion worth of FTX creditor settlements; the extension of the Mt. Gox repayments deadline, tabling an expected sell-pressure event; and continued demand for bitcoin ETFs, they added.
The US-listed spot bitcoin ETFs are on a six-day net inflow streak, during which nearly $2.4 billion has entered the products, Farside Investors data shows.
Read more: Crypto ETF takes from the Permissionless stage
The category’s last net inflow run of that length (or longer) was from Sept. 19 to Sept. 30. But the positive flows haven’t been as intense as the past week since July, when nearly $3 billion entered the US bitcoin ETFs between July 5 and July 22.
The latest inflows come amid what CoinShares research head James Butterfill called “growing expectations of a Republican victory in the upcoming US elections.”
Polymarket, as of three weeks ago, showed a roughly 50-50 split in terms of the projected presidential winner. Now, about 62% are betting on Trump, with four accounts recently pouring more than $30 million into Trump bets.
New York Times polling, as of this morning, shows a much tighter picture, with leads by Trump and Harris amounting to less than one percentage point in battleground states Pennsylvania, Michigan, Nevada, Wisconsin and North Carolina. The poll depicts Trump with a slightly larger edge in Georgia and Arizona.
As the industry expects the presidential election could impact the trajectory of the crypto industry, Coinbase Chief Legal Officer Paul Grewal noted at Blockworks’ Permissionless conference last week that the makeup of Congress could also be crucial for crypto regulatory progress.
The Compass Point analysts wrote in mid-September they believe a Republican sweep is the most likely outcome. Ron Hammond, director of government relations at Blockchain Association, told me earlier this month that a divided Congress could hurt Trump’s ability to deliver on some of his crypto-related promises.
“As much as [Trump] can say he wants market structure legislation or he wants to protect self-custody, a lot of that stuff’s got to be enshrined through legislation,” Hammond said. “So he has to work with Congress to get that over the finish line, and if it’s a Democratic House, that’s very tough to do.”
Gold hit an all-time high of about $2,740 on Monday morning. Analysts have noted that safe-haven assets are in demand as conflict continues in the Middle East and concerns about a global growth slowdown persist.
“Israel’s continuing bombardment of Lebanon and Gaza is adding to the risk of overspill into wider conflict in the region,” Hargreaves Lansdown’s Susannah Streeter said in a Monday statement. “The uncertain outcome of the US presidential election is also likely to be playing on minds and leading to more defensive positioning.”
BlackRock CEO Larry Fink had attributed some of an October 2023 bitcoin price rally to “a flight to quality” during geopolitical tension.
Samara Cohen, BlackRock’s chief investment officer of ETF and index investments, more recently noted during a Permissionless discussion that interest in various alternative investments picks up during times of war and changes to political and economic regimes.
“Clearly bitcoin is a risky asset just measured based on price volatility,” Cohen said. “But when you have major risk events in markets, one might argue that, a lot of times, those are triggered by events that should actually potentially be net positive for bitcoin.”
A modified version of this article first appeared in the daily Forward Guidance newsletter. Subscribe here so you don’t miss tomorrow’s edition.
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