Coinbase: Crypto Bull-Run in Q2 as Macro Trends Boost Sentiments

Bitcoin’s back and looking bullish in 2024! That’s the word from Coinbase’s new report “Constructive Outlook. It cites a mix of economic and technical factors pointing towards a potential price surge.

Let’s dive into the key trends shaping the crypto landscape and spot any opportunity that might be brewing!

Macro Momentum for ETFs

Shifting from technical pressures to macroeconomic factors, large liquidations, such as FTX’s disposal of Grayscale Bitcoin Trust shares, coincide with a surge in daily net inflows into US spot Bitcoin ETFs. This activity, averaging over $200 million daily and totaling $1.46 billion since January 11, suggests a growing market sentiment favoring digital assets.

Inflation, Retail Sales, and Caution

The U.S. economy’s core PCE inflation aligns with the Federal Reserve’s target, but concerns arise over a widening budget deficit and a cooling labor market. Despite robust retail sales, a potential economic slowdown in the first half of 2024 looms on the horizon.

Acknowledging balanced risks, the Federal Reserve has delayed decisions on tapering its quantitative tightening program until March’s end. This delay hints at a potential easing cycle starting on May 1, aligning with Bitcoin’s halving in late April, potentially providing support to digital assets.

The Airdrop You’ve Been Waiting For!

Solana’s recent airdrop for Jupiter, one of the largest ever, signifies a renewed ecosystem. Despite challenges during the airdrop, such as transaction failures and fee surges, Solana’s resilience and commitment to better performance are commendable. The upcoming 1.18 release aims to address these issues, highlighting the industry’s focus on enhancing user experiences.

Notable Developments

FTX’s commitment to repaying customers, potential SEC approval for spot Ethereum ETFs, and global regulatory developments underscore the evolving crypto landscape. Notable institutional and regulatory advancements contribute to a positive market sentiment.

Going global

Crypto and digital asset developments aren’t limited to the U.S. The global landscape is dynamic, from the Bank of England exploring a digital pound to the EU’s MiCA regulatory guidelines and Germany’s significant bitcoin seizure.

Coinbase’s report details positive market sentiment supporting Bitcoin, including stabilized CME OI and solid ETF flows. However, Ethereum’s waning interest raises questions. Traders’ increasing comfort with long crypto exposure suggests a favorable market outlook as we navigate through Q2 of 2024.

These trends collectively contribute to a promising narrative for Bitcoin in the coming months.

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