What’s Left Behind
Congratulations from Trump: Donald Trump celebrated Bitcoin’s $100,000 peak and shared a message of support on social media: “You’re welcome, together we will make America great again.”
FED Rate Cut and Bitcoin Statement by Powell: The FED cut the policy rate by 25 basis points. Powell stated that the Central Bank cannot own Bitcoin due to existing legal restrictions and that they are not seeking a change in the law.
Powell, Bitcoin Is Like Gold: FED Chairman Powell said that Bitcoin is a speculative asset and is similar to gold but is not a competitor to the dollar.
Bitcoin Reserve Plan from the US: Trump plans to create a strategic Bitcoin reserve using the $200 billion Currency Stabilization Fund.
Critical Appointments from Trump: Paul Atkins as SEC Chairman and David O. Sacks as “Director of Artificial Intelligence and Crypto”.
Bitcoin Reserve Call from Europe: Sarah Knafo has proposed to the European Parliament to consider Bitcoin as a strategic reserve asset.
Israel Launches Bitcoin Investment Funds: Israel has approved the launch of six Bitcoin mutual funds on December 31, 2024. The funds will track the price of Bitcoin and management fees will be between 0.25% and 1.5%.
Crypto Move from Putin: He approved the law granting ownership rights to cryptocurrencies and proposed the use of digital currency on the BRICS platform.
Share Increase by MSTR: MicroStrategy aims to increase the number of shares to buy more Bitcoin and put this plan to a shareholder vote. As of December 23, the company holds 444,262 Bitcoin.
MicroStrategy in Nasdaq-100: MicroStrategy was listed on the Nasdaq-100.
New Bitcoin Strategy from Michael Saylor: MicroStrategy announced that they will change their fund strategy after MicroStrategy’s $ 42 billion Bitcoin purchase target.
Microsoft’s Bitcoin Vision: Saylor advised Microsoft to adopt Bitcoin as a strategy and predicted that it would reach a market capitalization of $280 trillion in 2045. However, Microsoft shareholders rejected the Bitcoin investment proposal.
What Awaits Us?
FTX Payment Plan
Bankrupt Cryptocurrency exchange FTX announced that the first distribution to its customers will begin on January 3, 2025 and is scheduled to be completed within 60 days
D.Trump
US President D. Trump and Vice President Vance will be officially sworn in on January 20, 2025.
US Macro Data
Non-Farm Payrolls:
January 10, 2025, 13:30 PM UTC
Consumer Price Index (CPI):
January 15, 2025, 13:30 PM UTC
Gross Domestic Product (GDP):
January 30, 2025, 13:00 PM UTC
Personal Consumption Expenditure Price Index (PCE):
January 31, 2025, 13:30 PM UTC
FED Interest Rate Decision
The interest rate decision following the FED meeting in January will be announced on January 29, 2024, at 19:00 UTC. Investors and economists will closely follow this meeting as the FED’s interest rate decisions have a significant impact on global markets.
Crypto Insigth
| Market Overview | Current Value | Change (30d) |
|---|---|---|
| Bitcoin Price | 93,880 | -3.91% 📉 |
| Ethereum Price | 3,400 | -5.06% 📉 |
| Bitcoin Dominance | 57.79% | -0.29% 📉 |
| Ethereum Dominance | 12.80% | -1.53% 📉 |
| Total Market Cap | $ 3.21 T | -3.55% 📉 |
| Fear and Greed Index | 65 (Greed) | 84 (Extreme Greed) |
| Crypto ETFs Net Flow | – $275.4 M | |
| Open Interest – Perpetuals | $ 693.04 B | |
| Open Interest – Futures | $ 3.63 B |
*Prepared on 12.30.2024 at 08:40 A.M. (UTC)
Summary for December
Spot ETF
Spot BTC ETFs started December with a 15-day streak of positive net inflows, followed by 4 days of negative outflows after the FED announcements. Despite volatility throughout the month, positive inflows pushed the Bitcoin price to 108,000. BlackRock IBIT ETF and Fidelity FBTC ETF stood out with net inflows of $5.43 billion and $339 million, respectively, while GrayScale, Ark and Invesco ETFs saw net outflows. At the end of 241 trading days, total net inflows exceeded 35 billion dollars.
Spot ETH ETFs also experienced a period of intense investor interest in December. The streak of positive net inflows lasted 18 days, but ended on December 19 after the FED’s 2025 rate decision and Powell’s statements. During this period, the largest daily net inflow since launch was recorded as $428.5 million on December 5.
Options Data
According to Deribit data, 150,000 Bitcoin options contracts worth $14 billion expired in December. This amounts to 44% of the total open interest for all BTC options. Looking at the market dynamics from an overall perspective, there is strong resistance in the options market around the $100,000-$110,000 level. The data reveals that call options peaked at $100,000, after which there was a significant drop in volume. According to the statistics shared by Deribit, the probability of Bitcoin exceeding the $100,000 level at the end of this month is calculated as 43.68%, while this rate rises to 51.46% at the end of January next year.
January expectations
As we approach the end of December, Bitcoin has experienced occasional gains but has not been able to persist at the 108,000 level where it peaked with increased volatility. It is preparing for a negative close, showing a monthly decline of -2.80%. According to historical data, Bitcoin, which provides an average return of 5% in December, has not performed in line with expectations this year. In particular, October and November were characterized by remarkable rises in Bitcoin and the crypto market, while December was a month in which most of the gains were preserved.
When we look at January, the first month of the new year, we see that Bitcoin has historically displayed a similar image to December. Although there were deep declines from time to time, the overall picture shows an average gain of 3.35% in January. This data points to a steady growth trend in Bitcoin in the first month of the year, with volatile movements. In January, the inauguration of US President D. Trump, FTX Payments and the Macro Data in the rest of the Report will be highly influential on the market.
| Year/Month | Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 0.62% | 43.55% | 16.81% | -14.76% | 11.07% | -6.96% | 2.95% | -8.60% | 7.29% | 10.76% | 35.57% | -2.80% |
| 2023 | 39.63% | 0.03% | 22.96% | 2.81% | -6.98% | 11.98% | -4.02% | -11.29% | 3.91% | 28.52% | 8.81% | 12.18% |
| 2022 | -16.68% | 12.21% | 5.39% | -17.30% | -15.60% | -37.28% | 16.80% | -13.88% | -3.12% | 5.56% | -16.23% | -3.59% |
| 2021 | 14.51% | 36.78% | 29.84% | -1.98% | -35.31% | -5.55% | 18.19% | 13.80% | -7.03% | 39.93% | -7.11% | -18.90% |
| 2020 | 29.95% | -8.60% | -24.92% | 34.26% | 9.51% | -3.18% | 24.03% | 2.83% | -7.51% | 27.70% | 42.95% | -46.92% |
| 2019 | -8.58% | 11.14% | 7.05% | 34.36% | 52.38% | 26.67% | -6.59% | -4.60% | -13.38% | 10.17% | -17.27% | -5.15% |
*Prepared on 12.30.2024 at 08:40 A.M. (UTC)
Source: Darkex Research Department
FTX
FTX announced that the first distribution of customer payments will begin on January 3, 2025 and is scheduled to be completed within 60 days. The first payments will cover claimants in the so-called “Convenience Classes”. Payment schedules for other claim classes will be announced later. The company’s aim to distribute a total of $16 billion in funds to creditors creates an expectation of remarkable mobility in the markets. The announcement that payments will be made in stablecoins is expected to have a positive impact on Bitcoin and other cryptocurrencies as these funds return to the digital asset market.
Inauguration of D. Trump
On January 6, 2025, in a joint session of Congress, Donald Trump and J.D. Vance will be declared president and vice-president after their electoral votes are officially counted. Trump and Vance will take their oath of office on January 20, 2025. Trump’s re-election to the presidency may create a significant movement in the cryptocurrency market. The announcement of the details of the “Bitcoin Reserve Strategy” promised during the election process may pave the way for a new bullish wave in the markets. It seems possible that Trump’s policies will give a positive momentum to the Bitcoin price and open the door to new highs.
Next month will be a critical period for Bitcoin and the digital asset market, with the completion of some FTX payments and the US presidential transition. These developments are expected to cause widespread excitement in the crypto world.
Market Pulse
The first month of the new year begins with both new hopes and new risks for global markets. It would not be wrong to note the Trump factor and the US Federal Reserve’s (FED) interest rate cut course as the two leading dynamics. The President-elect will take his seat in the White House on January 20, and it remains to be seen how much of his promises he will fulfill. Especially for the digital asset world… On the other hand, the Federal Open Market Committee (FOMC), which started the interest rate cut cycle with a strong cut in the later part of 2024, will be very important in the new year.
A critical dynamic for all markets is the pace at which the FED, which oversees monetary policy in the world’s largest economy, will ease monetary tightening. Since the Bank has stated that it will make meeting-based decisions by monitoring macro indicators, it will continue to monitor key data in order to make a prediction in the markets.
First Important Data on January 10th
There is one point that the FED insists on, which is that they do not want to cause a deterioration in the labor market while trying to control inflation. Accordingly, labor market figures for the last month of 2024 will be closely monitored, particularly the non-farm payroll change (NFP) data to be released on January 10.
In October, the US economy added only 12,000 jobs, well below expectations (106,000), due to storms and strikes in the country. With the new report announced for November, this data was revised to 36 thousand and the employment increase for November was published as 227 thousand (Expectation: 218 thousand). It remains to be seen whether the NFP will again point to a strong increase in employment in December.
We believe that the pricing model of “good data bad market, bad data good market” will continue. This is because markets are more focused on the pace at which the FED will ease financial conditions than on the health of the US economy. In this context, a lower-than-expected NFP data may contribute to the rise in digital assets by strengthening expectations that the FED will cut interest rates faster than previously thought. A higher-than-expected NFP should be read as a dynamic that may create pressure.
*Note: The results of labor market data such as NFP and unemployment rate should be evaluated together. You can follow the expectation figures formed by the surveys in our daily analysis reports.
Inflation Data and Economic Growth
In recent months, inflation in the US is no longer slowing down. The annual headline Consumer Price Index (CPI) was 2.4% in September, 2.6% in October and 2.7% in November. This was perhaps the biggest factor that prompted the FED to follow up its strong rate cuts with smaller ones and then to stop the cycle of rate cuts for the time being.
December inflation will be an important data point that will shape expectations for the FED and may have an impact on pricing behavior before the first FOMC meeting of the year, which ends on January 29. A higher-than-expected CPI may reinforce the perception that the FED may have to wait longer without a rate cut, leading to a rise in the dollar and a decline in digital assets. In the opposite case, risk appetite may increase and we may see rises in cryptocurrencies as the first effect of the data.
One of the reasons that makes the CPI data important for the markets is that it will be released before the FOMC meeting. Apart from this, the economic growth (GDP) data for the fourth quarter of 2024 on January 30 and the December PCE Price Index on January 31 will be under the scrutiny of investors.
The US economy grew by 3% year-on-year in the second quarter of 2024 and 2.7% in the third quarter. Consumer spending continues to be the biggest driver of the country’s economic growth with a share of around 70%. How much expansion the world’s largest economy produces in the last quarter of the year will be important for all markets. A higher-than-expected growth rate could boost risk appetite in the markets, but could also lead to further tapering by the Fed. A lower growth rate could have the opposite effect. Therefore, we can say that we think that the GDP change may have a mixed impact on financial markets.
If the pricing behavior of the FED’s monetary policy comes to the fore, bad data that falls short of forecasts has the potential to even have a positive impact on digital assets. Because in such a case, there may be a little more room for the FED to cut interest rates. Of course, how much the figure will be below the forecasts is also important at this point. A GDP figure that is bad enough to trigger concerns about economic growth again (as we have seen in pricing behavior in September and early August) may lead to risk aversion this time. This would not reflect positively on digital assets. A very good GDP may also highlight the idea that the FED may avoid further rate cuts altogether, which could have a similar effect as risk aversion. To sum up, the pricing behavior of the market may change when data sets are far from expectations or slightly above (or below) expectations.
Expected on January 31st, the PCE Price Index, the FED’s preferred data to monitor inflation, will be one of the indicators that investors will want to analyze carefully. This data, like GDP, will come after the January 28-29 FOMC meeting and will mostly shape expectations for February.
On an annual basis, PCE was announced as 2.4% in November. Core PCE, which shows the change in the price of goods and services purchased by consumers excluding food and energy, signaled a faster pace of increase with 2.8%. This data set may give clues about the Fed’s rate cut course for the rest of the year. A higher-than-expected reading could have a negative impact on digital assets, while a lower reading could have a positive impact.
Will the FOMC Pass?
With the recent macro indicators and the statements of the FOMC members, including FED Chairman Powell, the markets largely do not expect to see another rate cut at the first meeting of the new year. The FOMC, which started the rate cut cycle with a “Jumbo” step of 50 basis points, cut the policy rate by 25 basis points each in the following two meetings and lowered the policy rate to 4.25%-4.50% range.
At the first meeting of 2025, the FED is not expected to change interest rates. We can say that an interest rate hike is already off the agenda. However, we can talk about a new interest rate cut expectation, albeit weak. We expect the FOMC to keep interest rates unchanged. However, we can state that if the FED cuts the policy rate again, it will be met with enthusiasm in digital assets. If it is kept unchanged, we should not expect any new pricing, but the messages regarding interest rate decisions in future meetings may be decisive.
For the time being, the FED is expected to follow a 50 basis points (or 75 basis points to a lesser probability) rate cut path until the end of the year. A cut is not expected in the first quarter and a new 25 basis point move is likely in the spring or summer after a break in the discount cycle. On January 29th, if there are any announcements that may lead to a change in this course, the markets may move a bit. This means new pricing. An FOMC statement and/or Chairman Powell’s remarks, which would increase the likelihood of more rate cuts sooner and more frequently than anticipated, could support expectations of a more rapid easing in the tightness of financial conditions and create a basis for rises in digital assets. Statements that would lead to the opposite perception could put pressure on cryptocurrencies.
To summarize, the FOMC statement, which may lead to a change in expectations for further rate cuts of 50-75 basis points during the year, may cause pricing models to be revised and prices to be shaped accordingly. Chairman Powell’s statements will play an important role in shaping and dosing these expectations.
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The investment information, comments and recommendations contained herein do not constitute investment advice. Investment advisory services are provided individually by authorized institutions considering the risk and return preferences of individuals. The comments and recommendations contained herein are of a general nature. These recommendations may not be suitable for your financial situation and risk and return preferences. Therefore, making an investment decision based solely on the information contained herein may not produce results in line with your expectations.
