Cryptocurrency Market Analysis [October 7]
Cryptocurrency market: waves of historic capital inflows and new highs
Bitcoin rose significantly due to the impact of the U.S. government shutdown and other factors, recording a historic high of $125,000.
By September, when the Fed cut rates was priced in and other financial assets were at high levels, the cryptocurrency market had been subdued, but now it is showing a rise that seems to embody the anomaly of October and November (months with historically high performance), marking six consecutive days of bullish candles.
Following the victory of Ms. Takashi in the recent Japanese prime minister election and expectations of a yen depreciation, on October 4th the price in yen hit a record high of 18,250,000 yen.
Additionally, toward the year-end, bold Bitcoin price forecasts from major financial institutions, such as $130,000 to $200,000, are becoming prominent.
Main asset trends
Ethereum (ETH)
Ethereum again reached the upper price range of $4,670 and remains at a high level, with a weekly increase of 11%.
Recently, news from Grayscale about an ETF approval with staking functionality (unofficial) has been circulating.
Altcoins
Among the top market cap altcoins, BNB recorded an all-time high of $1,220, up nearly 120% since the start of the year.
Weekly change: XRP +2.3%, SOL +8.3%.
Rising coins: among the top 100 by market cap, Zcash (ZEC) has shown an extraordinary surge of 85.3%.
Record capital inflows into the market
According to CoinShares data, inflows into cryptocurrency investment products last week reached a record high of $5.95 billion (about 893.1 billion yen).
As a result, as of October 6, Japanese stocks, Japan’s 30-year government bond yields, gold, and Bitcoin all recorded historical highs, indicating substantial capital inflows across financial assets.
Market sentiment and comments from prominent figures
Fear & Greed Index and comments from notable figures
Bitcoin’s Fear & Greed Index has risen to 70. It has surged from a low of 26 on September 26, and some investors see this as a signal of a start toward year-end.
Ray Dalio commented, “Many people view Bitcoin as an alternative money, which is noteworthy. Of the two roles money must serve—means of exchange and store of value—the more important is the latter.”
Accelerating yen depreciation and economic disparity
The yen has reached its weakest level against the euro as well, with the depreciation accelerating.
Views from prominent figures
In light of Takashi’s presidential win and concerns about fiscal looseness (foreseen), there are notable points about the depreciation of the yen.
Hiroyuki: concerns about the pace of yen depreciation and rising long-term interest rates. “If interest rates rise, the Japanese economy will be tough,” he says.
Oishi: warns that the stock price rise is “just that the value of the yen is falling,” and not a real improvement.
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(This article has been distributed since 2016)
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