BTC's Price Could Gain from US Fiscal Dominance - Standard Chartered
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Trump Win Could Boost BTC’s Price

In a recent research report released by Standard Chartered, the bank’s analysts delved into the potential implications of US fiscal dominance and the outcome of the upcoming presidential election on the trajectory of Bitcoin (BTC). The report suggests that both scenarios could significantly influence BTC and the digital asset market.

According to the report, increased US fiscal dominance, coupled with the monetization of government debt by the Federal Reserve, would drive investors to seek alternative assets such as cryptocurrencies. This shift in investor sentiment could provide a supportive environment for BTC since it is viewed as a hedge against traditional market uncertainties.

The leading digital asset could also hedge against de-dollarization and declining confidence in the US Treasury market. Analysts at Standard Chartered also speculate that a second Trump administration could lead to a more favorable regulatory environment for cryptocurrencies. 

Potential Effects of US Fiscal Dominance on Bitcoin

Geoff Kendrick, an analyst at Standard Chartered, highlights three potential effects of US fiscal dominance on the US Treasury curve — a steeper nominal 2-year/10-year curve, a greater breakeven increase than real yields, and an increase in the term premium. 

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Furthermore, Standard Chartered anticipates that a second Trump administration would actively support Bitcoin and other digital assets through less strict regulation and the approval of more US spot crypto ETFs. This regulatory stance could significantly boost the cryptocurrency market and benefit BTC’s broader adoption.

Hence, Standard Chartered reiterates its bullish outlook on BTC, forecasting that it could trade at $150K by this year-end and $200K by the end of 2025.

Bullish Momentum Persists in Bitcoin Options Markets 

Meanwhile, recent data from Kaiko shows that the Bitcoin options market has maintained its bullish bias. Despite recent market volatility, market participants remain optimistic, with call options outweighing put options in volume.

According to the report, last week’s fluctuations saw Bitcoin drop below the $57,000 mark before rebounding over the weekend, driven by eased concerns over Federal Reserve interest rates. This volatility proved advantageous for put options to expire by the end of May, as they briefly entered profitability when BTC traded within the $57,000 to $60,000 range.

Puts, granting holders the right to sell the underlying asset at a predetermined price, constitute approximately 28% of the volume on Deribit for the May 31 expiry. Traders utilized these positions for portfolio hedging or anticipating further price declines.

However, with Bitcoin’s recovery above $64,000, these put options are no longer profitable. Instead, call options have regained profitability and will remain profitable should BTC trade within the $60,000 to $65,000 range. 

Despite this shift, calls continue to dominate puts in terms of volume, reflecting an overall bullish outlook among market participants. However, Bitcoin options contracts expiring on September 27 are predominantly composed of call options, with a strike price of $65,000 as the most popular choice.

This suggests that just over $300 million worth of call options will be profitable if Bitcoin maintains a price above $65,000 by the end of September.

Memecoins Maintain Dominance in Leverage

Despite recent market corrections, some memecoins maintain dominance in leverage among the top 30 altcoins by market capitalization. Notably, Pepe (PEPE) and Dogwifhat (WIF) stand out with leverage ratios double that of other altcoins. Following is Filecoin’s FIL token, which experienced a rally after its integration with Solana in mid-February. Bitcoin Cash (BCH) is also notable mention.

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George Ward

By George Ward

George Ward is a crypto journalist and market analyst at Herald Sheets, known for his engaging articles on the latest digital currency trends. With a background in finance and journalism, he presents complex topics accessibly. George holds a degree in Business and Finance from the University of Cambridge.

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