Bitfinex Releases 130th Alpha Report
According to the Bitfinex Alpha Report, Bitcoin has recorded a significant price increase, reaching new highs above $82,000 following Donald Trump's re-election as President of the United States. Coupled with the market's positive reaction to the election victory, strong consumer confidence, and steady growth in the US economy, inflation risks and policy uncertainties create a cautiously optimistic outlook.
In Bitfinex's 130th Alpha Report, it is noted that following Trump's re-election, Bitcoin surpassed its all-time high by reaching new peaks above $82,000. The positive market response to the election victory led to an impressive 23% increase in BTC prices after a pre-election decline. A record inflow of $2.28 billion in ETFs within three days indicates a renewed institutional demand for Bitcoin.
After the election, record ETF inflows and increased speculative activity have contributed to stability in the Bitcoin market. BlackRock's IBIT ETF alone saw a net inflow of $1.1 billion, reversing the outflows observed during pre-election risk mitigation. This increase in demand has stabilized market dynamics, with buying interest hitting all-time highs. Additionally, a marked increase in the Spot Cumulative Volume Delta signals strong buying activity in major exchanges post-election, while open interest in Bitcoin futures and perpetual contracts also reached all-time highs, reflecting rising speculative activity. However, with open interest and prices stabilized at high levels, the market continues to remain stable for now.
Furthermore, realized profits reached an all-time high of $3.1 billion in March, although the current wave of profit-taking remains relatively modest. This scenario reflects a maturing market recalibrating expectations for fair value. While the momentum appears promising, the $82,000 to $85,000 range may present a psychological resistance point. Before Bitcoin continues to climb on higher time frames, some consolidation or a potential pullback to $77,000 is anticipated as it aims to close the gap at the Chicago Mercantile Exchange. The resilience supported by institutional participation and newly discovered demand provides a solid foundation for Bitcoin's price discovery in unexplored territories.
The US economy is showing signs of strengthening with robust consumer confidence, stable growth, and alleviation of inflation pressures, bolstered by Trump's electoral victory. Following his election, markets responded positively to growth-oriented policies, including tax cuts and regulatory rollbacks. However, such policies may also bring inflation risks, particularly if tariffs and stricter immigration rules are implemented, potentially leading to rising prices and wage costs. On the other hand, the Fed's recent 25 basis point rate cut reflects confidence in sustainable growth, supported by strong productivity and a stable labor market.
Interest rate cuts, consumer optimism, and growing hopes in the crypto market support economic growth. Nonetheless, the Fed has cautioned about rate cuts, stating it will remain flexible until clearer fiscal signals are received. Consumer sentiment has risen to its highest level since April due to falling oil prices and diminishing short-term inflation concerns. This optimism suggests that strong economic performance could be seen in the coming months, although inflation risks and policy uncertainties create potential challenges, making this period economically optimistic but cautious.
Regarding developments in the crypto market, Trump’s election victory is deemed highly favorable, leading to a surge in Bitcoin prices and hope for reduced regulations along with the potential for a national Bitcoin reserve.
On the other hand, Tether has expanded its utility by successfully financing a $45 million crude oil transaction in the Middle East, marking its entry into the commodity market. Through its new Trade Financing division, Tether aims to position USDt as a transformative tool for faster and cost-effective global trade, beyond energy sectors. In regulatory news, the SEC has once again delayed its decision on options concerning spot Ethereum ETFs due to concerns regarding investor protection and market stability.