Related Reading: Bitcoin ETF Options Set To Supercharge Price Volatility, Expert Warns However, he remains optimistic about opportunities within the market, stating, “The constant rotation of capital and new projects being developed means there will still be coins to buy to generate returns as a bull.” Nonetheless, Kang warns of potential volatility due to leveraged positions: “The market will still be prone to smaller corrections if leverage gets too high (decently high right now).” Engaging with the community, X user Jakubko (@erkousti) suggested that Bitcoin’s 2023 price increase is more connected to anticipation of an ETF launch than interest rates.
Kang challenges the prevalent market belief that interest rate cuts by the Federal Reserve will significantly boost Bitcoin and crypto prices.“Fed rates are only one of the factors that impact global liquidity, and global liquidity itself is only one of the factors that influence crypto prices,” he stated.
Kang finds it “nonsensical to see BTC rally 4.5x during a period where rates were going to and at multi-decade highs—showing little correlation between rates and BTC—and then expect a strong inverse correlation to present itself as soon as rates start going down.” Related Reading: Bitcoin Whales Are Going Through A Generational’ Shift, CryptoQuant CEO He acknowledges that some argue future rate changes are already priced into the market but counters that this logic should apply equally to rate hikes and cuts.“This is not to say that rates are not important, but rather that they are well overweighted by most market participants,” Kang added.
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