Bitcoin’s (BTC) breakout above $65,000 could lead to a ‘very high’ chance of a broader crypto rally in Q4 2024, according to Markus Thielen, head of research at 10x Research.
Bitcoin Rally Based May Cause FOMO In Altcoins
The latest reportThielen described several factors that could set the stage for a crypto rally in the latter half of 2024. According to the report, a further rise in crypto markets may be on the cards due to two key factors.
First, the acceleration of stablecoin minting signs is growing among investors and traders in re-entering the crypto market.
In the weeks following the July 31 Federal Open Market Committee (FOMC) meeting, nearly $10 billion worth of stablecoins were issued, increasing market capitalization even more than Bitcoin exchange-traded fund (ETF) inflows.
The report says:
The circle, which often caters to highly regulated institutions, accounted for a disproportionate 40% of the stablecoin’s recent revenue, a sign of increased share from major market players. Unlike the USDT transaction on Tron, which is usually associated with capital reserves, the USDC transaction may indicate an increase in DeFi activity. To date, stablecoin inflows have reached $35 billion, pushing the total number of outstanding stablecoins to $160 billion.
Thielen emphasizes Bitcoin’s recent breakout above $65,000, saying it could quickly move to the psychologically important $70,000 price level before it tries to print a new all-time high (ATH).
Another metric that suggests there may be an altcoin rally later this year going down Bitcoin (BTC.D) dominance following the September FOMC meeting. BTC.D’s decline coincides with the rise of the Ethereum network gas fee (ETH), possibly driven by increased altcoin activity on the smart contract blockchain.
The chart below shows the rising cost of Ethereum gas, rising from $1.89 million on August 13 to remain above $7 million as of September 22.
The report adds that if it is assumed that the US Federal Reserve (Fed) continues to reduce interest rates, high beta altcoins may be more attractive to crypto traders.
Promoting Cryptocurrency Trends in South Korea, China
The report highlights South Korea’s crypto trading activity as a factor strengthening the altcoin trend. Daily trading volume in the country now hovers around $2 billion, with altcoins dominating trading activity ahead of BTC.
Notably, Shiba Inu (SHIB) regained the first position by trading volume in South Korea, indicating developed speculating and paving the way for a potential altcoin market in Q4.
Finally, Thielen highlights that Chinese over-the-counter (OTC) vendors have reported quarterly inflows of about $20 billion over the past six quarters, including $120 billion.
As reported recently, China’s central bank reduced reserve requirement ratio (RRR) by 50 points to inject money into the market, which may further rally the prices of digital assets later this year.
The report concludes by predicting that the next target for Bitcoin will be $70,000 within two weeks, with a possible new ATH in late October. BTC is trading at $66,298 at press time, up 1.4% in the last 24 hours.
Featured image from Unsplash.com, Charts from DefiLlama.com and TradingView.com