Can the recent rise in cryptocurrency prices be sustained, or have we already reached the peak of this cycle?
Our latest analysis, developed in collaboration with research firm Praxis Veritas, takes a comprehensive look at the macroeconomic factors that could shape the future value of digital assets. The report, titled “Where Are We in the Crypto Cycle?”, explores potential scenarios that could impact the crypto markets in the coming years.
Key Highlights from the Report:
Global Monetary Policy and Crypto:
Looking ahead, global monetary policy is expected to have a minimal impact on cryptocurrencies. The risks associated with long-term interest rates worldwide are now skewed toward the downside, which could serve as a tailwind for the current crypto cycle. Additionally, continued depreciation pressures on the U.S. dollar may enhance the value of cryptocurrencies relative to the dollar. A weaker dollar combined with aligned monetary policies among central banks could provide further support for crypto prices.
Policymakers and Asset Prices:
Policymakers are more likely to respond aggressively to negative shocks in asset prices than to rising inflation or rapid economic growth. This dynamic has become a significant positive factor for bitcoin’s price. In a world where policymakers regularly intervene to maintain financial stability, assets that exist outside traditional financial systems, like bitcoin, are becoming increasingly valuable. This perspective remains crucial in shaping the outlook for major cryptocurrencies that are sensitive to macroeconomic trends.
Improving Global Regulatory Landscape:
In the United States, the regulatory environment for cryptocurrencies has gained the attention of the Republican party, which is eager to position the country as a leader in digital assets. Additionally, there are indications that the Biden administration’s strict crypto enforcement policies may be eased, as suggested by outreach from Kamala Harris’s campaign team to key crypto industry figures. Internationally, the potential for China to lift its crypto ban is growing, and Hong Kong has significantly improved its regulatory approach to the industry over the past year.
Where Are We in the Crypto Cycle?
For an in-depth analysis of the factors driving long-term crypto growth, we encourage you to review the full report.
Disclaimer: This material is for informational purposes only and does not constitute an offer or solicitation to buy or sell any investment products or securities. It also does not provide legal, accounting, or tax advice, nor does it offer investment recommendations. The views expressed are those of Gemini and do not necessarily reflect the official policy or position of any other organization. Cryptocurrency trading involves significant risks, including the potential loss of the entire investment. Readers should consult with a financial advisor before making any investment decisions. Unauthorized use, distribution, or reproduction of this content is strictly prohibited without written permission from Gemini.