Bitcoin at a New All-Time High!

On the night of Tuesday to Wednesday (Nov 6, 2024), Bitcoin reached a new all-time high of 75,361 USD (70,213 €), according to the Coinmarketcap portal. Bitcoin surpassed its previous high from March by more than $1,500, with the main catalyst for this rise undoubtedly being the early results from the United States presidential election, in which pro-bitcoin candidate Donald Trump led virtually from the start.

In particular, the third and ongoing fourth quarters of this calendar year have been filled with anticipation of how the United States presidential election will affect Bitcoin and the entire cryptocurrency market. Presidential candidate Donald Trump has fully exploited the potential of Bitcoin in his campaign and has regularly spoken about it at various meetings and events. Trump even attended the Bitcoin 2024 conference, where he was a speaker and declared that if he wins the presidential election, he will create a so-called Bitcoin reserve in the US. In addition, Trump, backed by the likes of Elon Musk, who has also invested in Bitcoin in the past, has promised to remove US Securities and Exchange Commission (SEC) chairman Gary Gensler, who has cracked down hard on companies and projects operating in the cryptocurrency world in recent years.

The positive mood accompanying the election results was also reflected in the growth of several altcoins. At the time of writing, for example, Solana (SOL) has risen nearly 13% in the last 24 hours, Dogecoin (DOGE) has gained nearly 14% and Uniswap (UNI) has risen as much as 25%.

Source: Coinmarketcap

BTC Dominance Hits 61%

Over the past weeks, Bitcoin has continued to strengthen its market dominance. On Wednesday morning, BTC’s dominance reached 60.91%, its highest level in 3.5 years. BTC’s dominance is currently exhibiting similarly familiar behavior to that seen during 2020 when Bitcoin was significantly strengthening its market position until early 2021. However, the beginning of 2021 was then already marked by the so-called altcoin season, during which altcoins grew much faster than Bitcoin itself.

Source: Tradingview

Interest Rate Decision Tomorrow

The US Federal Reserve (Fed) meets today and tomorrow to discuss the future direction of monetary policy in the United States, while also announcing its decision on interest rates.

The Fed, under the leadership of Jerome Powell, is expected to continue easing monetary policy and will cut the benchmark interest rate by 25 basis points (0.25%) at this meeting. This move would mark the second consecutive rate cut by the Fed, with the first cut seen in the market in September when the Fed cut the rate by 50 basis points. The September cut was also the first rate cut since 2020.

A reduction in interest rates generally lowers the cost of borrowing, including mortgages or business loans, which encourages consumption by individuals and institutions. At the same time, interest rate cuts reduce returns on safe investments such as government bonds or bank deposits. When yields on these assets fall significantly, investors are motivated to seek out higher-yielding assets – they are looking for assets that are riskier but can give them a higher return. Such assets include, for example, equities or cryptocurrencies.

 Fear and Greed Index in the Greed Zone

The Cryptocurrency Fear & Greed Index, which tracks and analyzes current investor sentiment in the cryptocurrency market, currently stands at 70 points out of 100. This signals the so-called greed band, when investors are in a good mood and the overall sentiment in the market is very positive. 

Source: Alternative.me 

The Cryptocurrency Fear & Greed Index has not been especially affected by Bitcoin ETFs, from which investors have withdrawn nearly $700 million over the past three days. However, the outflows from bitcoin ETFs were likely a reaction to the upcoming election as well as Trump’s preferences in the prediction markets dropping significantly a few days before the election.