According to a recent research report published by OKG Research on Tuesday, crypto markets felt the reverse of the Trump trades, which began during the presidential election period.
The report outlined the significant drop in BTC prices from an all-time high of over $99,000 to around $93,000. OKG Research noted that the drop, which was 6%, was one of the greatest declines the coin faced during the bull market.
The report further highlighted the possibility of recent geopolitical news suggesting a ceasefire between Lebanon and Israel to have caused the decline. Other commodities, including gold and crude oil, also plunged sharply. Notably, BTC and gold have regained some of their price momentum, with BTC gaining 2.10% and gold gaining about 0.67%. Crude oil prices have still been down in the past 24 hours, the same as yesterday.
The research still pointed out that yesterday’s market shakiness caused unrest among investors, with speculations about whether the bull market was coming to an end. However, the report outlined that the drop was seen as a result of several macroeconomic factors that had a short-term impact. OKG Research added that the liquidity coming into the markets currently would not allow ‘an abrupt end to the cycle.’
OKG Research says the recession probability is currently around 24.9%
OKG Research mentioned the recent interest rate cuts initiated by the Federal Reserve. The Fed initiated the first cut on September 18, cutting rates by 50% and pushing the borrowing rate between 4.75% to 5.00%. The Fed cut rates again this November by 25%, lowering borrowing rates to 4.50% and 4.75%.
The report explained that the Fed rate cuts helped BTC balance liquidity injection and hedging against inflation. Additionally, the firm confirmed that political unrest and economic volatility make crypto assets, including BTC, a hedge against real-world risks.
OKG Research pointed out Trump’s plans to use cryptocurrencies to weaken other currencies. The firm further outlined the incoming president’s plan to make BTC the U.S. strategic reserve asset. U.S. officials have also been campaigning for the international crypto regulatory framework to be U.S.-led.
Still, the firm outlined the skepticism of some economists in the financial sector, expecting a financial crisis despite the rate cuts. However, the report cited data from MacroMicro’s U.S. Recession Index (Probability), which indicated a 24.9% probability of a recession happening. The firm speculated that, compared to previous recession cycles, a financial crisis could be possible in about six months.
BTC ETFs account for over 5% of the total Bitcoin in circulation
#BTC 현물 ETF 축적량, 전체 공급량의 5.33%
[현물 ETF BTC 축적량]https://t.co/glrt9yRxCX#비트코인 현물 ETF 물량은 거래가 시작된 1월 629.9K BTC → 1.0545M BTC 로 +425K BTC 가 증가되었습니다. 이는 현재 채굴된 총 공급량 19.78M BTC 에서 3.15% → 5.33%로 단 10개월 만에 2.18%가… pic.twitter.com/JZ1wZ2K79V
— MAC.D (@MAC_D46035) November 17, 2024
The research cited data from the Ouke Cloud Chain Research Institute, highlighting that Bitcoin spot ETFs account for over 55 percent of the total BTC supply. According to the data, ETFs’ current holdings have increased since their introduction at the beginning of this year.
The report also pointed out the significance of crossing the 5% threshold in the financial world. OKG Research gave an example with the U.S. Securities and Exchange Commission, which demands that shareholders with over 5% of shares are required to report to the commission.
The research firm further outlined the importance of institutional liquidity to the top cryptocurrency. OKG Research confirmed the increased adoption of BTC among U.S. and Japanese-based companies. More importantly, about 17 listed companies have reported their BTC holdings or have had their board of directors approve BTC adoption as a combat asset.
The firm mentioned MicroStrategy as one of the top BTC holding companies in the U.S. As reported by Cryptopolitan on November 25, the Wall Street asset management company increased its BTC holding by 55,000 more BTC worth around $5.4 billion.
The purchase is not the only one the company has made this month. On November 18, MicroStrategy bought about $4.6 billion worth of BTC, bringing its total BTC holdings to 386,700 BTC.
OKG Research still noted that only 0.01% of global listed companies currently hold BTC. The firm added that the market was still in the ‘elite experimental stage.’
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