QCP Capital analysts doubt Bitcoin's growth this year

QCP Capital: The cryptocurrency market may fall in the fourth quarter of this year

According to analysts, macroeconomic factors are not in favor of the growth of the digital assets market

Analysts of trading company QCP Capital prepared a report in which they doubted the readiness of the U.S. Securities and Exchange Commission (SEC) to approve the application for a bitcoin-ETF this year. In their opinion, the price of digital currency will depend on macroeconomic factors, which are not in favor of the growth of risky assets.

The authors of the report write that the main reason for their bearish mood is the extreme expectations of market participants associated with seasonal growth in the fourth quarter: "Looking at NASDAQ returns by year, we see that October is a key turning point for the markets, but not necessarily the start of the rally". QCP specialists expect a repeat of the dynamics of the last quarter of 2008, 2018, or even 2000, not 2007 and 2017, which is what most are now expecting.

"We expect the most serious trigger to be an exponential rise in US real rates when the consensus view of market participants expects them to fall," the company said in its report.

According to analysts, market participants underestimate the possibility of an escalation of military conflict in the region, especially if Iran and even more so US troops enter the war. The probability of such an outcome of events is especially increased against the background of the speeches of President Biden, who declared the readiness of the United States to support Israel and taking into account the U.S. citizens who died in the attack of Hamas or were held captive by them.

Another analyst firm CryptoQuant estimates that the price of the first cryptocurrency could rise to $50-70k if the bitcoin-ETF is approved.

Earlier this week, Larry Fink, CEO of investment company BlackRock, said in an interview on Fox Business that the sharp rise in the price of the first digital currency, caused by false rumors about the approval of a spot ETF on bitcoin, is the result of "accumulated interest in cryptocurrencies." He also noted that amid the escalating conflict in the Middle East, more people will invest in safe assets, be it bonds, gold, or digital currencies.