- The U.S. Federal Reserve is expected to cut interest rates in the first half of 2024, which could benefit Bitcoin and gold as investors shift towards fixed supply assets.
- Bitcoin typically has a negative correlation with the U.S. dollar, so their inverse relationship shows a complex dynamic between traditional and digital assets.
- While Ethereum has seen major upgrades, it seems undervalued compared to Bitcoin, but the possibility of an Ethereum ETF could increase interest.
Bitcoin and crypto analysts predict Bitcoin could see increased appeal in 2024 if the Federal Reserve cuts interest rates. While not expecting a huge rise, some see macro conditions aligning for renewed crypto interest.
U.S. Federal Reserve Likely to Cut Rates
The U.S. Federal Reserve is expected to cut interest rates in the first half of 2024. This could benefit Bitcoin and gold as investors shift towards fixed supply assets. Analysts say monetary easing has helped risk assets historically. With the U.S. economy still strong, rate cuts may boost crypto appeal.
Bitcoin’s Correlation with the U.S. Dollar
Bitcoin typically has a negative correlation with the U.S. dollar. This correlation may increase amid monetary shifts and market stress. While the dollar has risen recently, Bitcoin’s price has dipped. Their inverse relationship shows a complex dynamic between traditional and digital assets.
Importance of U.S. Bitcoin ETFs
The U.S. market’s approval of Bitcoin ETFs brings legitimacy globally. While Europe has spot Bitcoin ETPs, the influential U.S. market signals wider acceptance. Bitcoin ETFs sparked a bullish impulse but it’s unclear if it will sustain a long-term bull run.
Ethereum Remains Underappreciated
Despite Ethereum‘s major upgrades, it seems undervalued by investors. The Ethereum Foundation has adeptly managed transitions like The Merge. However, Ethereum does not get the same attention as Bitcoin. The possibility of an Ethereum ETF could increase interest.
Conclusion
While predictions are mixed, macro conditions point to potential Bitcoin and crypto gains if the Fed eases policy. Continued adoption through ETFs and upgrades also help. But it remains difficult to predict if renewed bullishness will be sustained long-term.
