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When Should We Expect a Bitcoin Price Rebound? Compiled by Chinese Analysts!
The cryptocurrency market was shaken as Bitcoin's price fell below $93,000, hitting a record high of $108,135 and losing 14%.
Analysts attribute this decline to the December meeting minutes of the Federal Open Market Committee (FOMC) released on Wednesday, highlighting the impact of the Trump administration's hawkish Fed policy stance.
The FED minutes revealed that concerns about the impact of Donald Trump's second presidency on policy played an important role in shaping the central bank's outlook. According to Presto Labs analysts Peter Chung and Min Jung, this development challenges the general narrative that Trump's return to the White House will trigger a crypto market rally.
Trump promised to reduce the regulatory bureaucracy that has long disappointed the crypto industry, and many analysts forecast that his policies could push Bitcoin to $200,000 by 2025. However, the recent market behavior indicates an ongoing recalibration, and experts are warning that patience is required.
Chung and Jung wrote in a research note, “There will be a breakthrough when the market completes the recalibration process and uncertainty disappears,” and added that there may not be signs of recovery until after Trump's inauguration on January 20 and the first 100 days of his administration.
Carlos Guzman, an analyst at GSR, noted that many positive catalysts, such as Trump's appointment of crypto-friendly officials, have already occurred. However, he maintains a long-term bullish outlook for 2025, especially for the realization of regulatory clarity and crypto-friendly policies in the US.
In the short term, analysts point to several factors that could revive the rally.
Crypto-friendly nominations: Trump is expected to make crypto-supportive additional appointments to key regulatory positions.
FTX bankruptcy payments: These payments planned for February could provide a return of $2-8 billion to the crypto markets.
China's economic woes: David Brickell, international distribution head of FRNT Financial, highlighted the potential for Bitcoin to benefit from capital outflows as the yuan weakens in China.