Cryptocurrency Markets Hold Breath as Bitcoin Stalls Below $100,000
Despite a remarkable 40% surge since the US election, Bitcoin’s price has plateaued, failing to break the coveted $100,000 mark. Analysts weigh in on the reasons behind this stall, citing profit-taking, supply constraints, and regulatory uncertainty.
Profit-Taking and Sentiment Shift
Andre Dragosch, head of research at Bitwise, attributes the stall to investors cashing in on their gains. “Long-term holders have started to distribute significant amounts of bitcoins into the recent rally,” he notes. This sentiment shift may lead to a short-term correction, but Dragosch believes it’s a bull market correction rather than a trend reversal.
Supply Constraints and Regulatory Uncertainty
The reduction in new Bitcoin issuance following the “halving” event earlier this year will continue to support prices in 2025, according to Dragosch. However, Marion Laboure, strategist at Deutsche Bank, cautions that concrete federal crypto legislation remains elusive, despite President Trump’s pro-crypto stance. The idea of a US national bitcoin reserve is still a distant prospect, and major reforms will require congressional approval.
Market Correction and Leverage
Mark Novogratz, CEO of Galaxy Digital, anticipates a correction due to the high level of leverage in the system. He advises investors to buy “straight bitcoin” rather than exposed plays, citing an unknown seller who has been dumping crypto in recent days. David Morrison, senior market analyst at Trade Nation, notes that $100,000 has become a psychological barrier, but there’s still a strong probability of upside momentum building for a surge through this level.
Regulatory Environment and Industry Impact
Laboure views regulation as a net positive for the industry, despite the uncertainty surrounding concrete legislation. Meanwhile, Trump’s pro-crypto pledges, including forming a national crypto stockpile and replacing SEC Chair Gary Gensler, have boosted sentiment. As the crypto community waits with bated breath for Bitcoin to breach the $100,000 mark, analysts agree that the market is due for a correction, but the overall trend remains bullish.
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