Americas Crypto Market Overview: Banks Place Bets on a Stronger US Dollar Amid Ongoing Bitcoin Volatility

By Omkar Godbole (All times ET unless otherwise specified) The ongoing struggle between bull and bear forces in the Bitcoin market persists, with prices rebounding to over $97,000 after dipping to $94,200 on Monday. This decline was triggered by concerns that Google's new quantum computing chip, Willow, could potentially compromise the security of BTC, a worry that was quickly alleviated by analysts. As a result, directional traders are left with limited options but to wait for market clarity before making their next move, given that prices remain within Thursday's indecisive trading range. However, a positive outcome of this turbulence is the departure of undisciplined and over-leveraged altcoin traders, as evidenced by perpetual funding rates. The rates for altcoins have moved closer to the neutral zone on Velo Data's heat map, which fluctuates between -200% and 200%, indicating a shift towards more balanced market conditions compared to the bullish extremes observed last week. Certain tokens, such as Stacks' STX, are even experiencing negative funding rates, which according to pseudonymous analyst Byzantine General, presents an ideal entry point for bulls. "If these rates continue to decline, it could signal the unwinding of excessive long leverage, potentially leading to a more balanced market," analysts at Bitfinex noted, adding that the $100,000 level is no longer the key support or resistance level and a new equilibrium is likely forming in spot markets. Meanwhile, as we approach the end of 2024, a notable trend is emerging: banks are becoming increasingly bullish on the US dollar, which typically does not bode well for assets denominated in the US currency, including BTC and other risk assets. "The combination of cyclical, fiscal, and US political forces is contributing to the strengthening of the USD," HSBC recently stated. "We are revising our USD bullish view; the USD bubble is reinflating, which spells trouble ahead for many other currencies." Citibank predicts the dollar index (DXY) will rally to 115, representing an 8% increase. It is also worth keeping an eye on developments in the Far East, as a renewed rally in Chinese stocks following Beijing's promise of additional stimulus could potentially divert capital from other markets, including cryptocurrencies. Amidst these developments, there is speculation that President-elect Trump may face challenges in delivering on his crypto-related promises. Peter Tschir, head of macro strategy at Academy Securities, aptly summed it up: "Trump does have loyalty to those who helped fund his campaign, but I don't see this as a lasting relationship, especially as he will likely face significant pressure from the National Security element of D.C. to exercise caution in supporting crypto." After all, it's one thing to make promises from Mar-a-Lago, but it's an entirely different scenario when it comes to delivering from the White House. Remain vigilant! Key Events to Watch Upcoming Token Events: Conferences: Token Talk By Shaurya Malwa The 'quantum' hype is in full swing! Various tokens associated with or claiming to utilize quantum computing within their technology stack have seen significant gains of over 100% in the past 24 hours, following the unveiling of Google's quantum-computing chip, Willow, which demonstrated the ability to solve tasks in 5 minutes that would have taken current supercomputers 10 septillion years to complete. The crypto market experienced a downturn after the announcement, driven by concerns that this development could have long-term bearish implications for bitcoin and other blockchains, whose security features could theoretically be compromised by quantum computers. However, while the broader market declined, tokens such as QRL, Quantum Network, and Quantum Swap saw substantial increases. Quantum-resistant or post-quantum tokens aim to utilize cryptographic algorithms that are believed to be secure against quantum computing attacks. These algorithms are designed to withstand attacks using Shor’s algorithm, which is particularly effective against current public-key cryptosystems. Tokens labeled as 'quantum' may be perceived as being at the forefront of technology, even if their actual utility or connection to quantum computing is minimal. This perception can drive investment and create opportunities for short-term speculative trading. Derivatives Positioning Market Trends: Bitcoin Statistics: Basket Performance Technical Analysis Crypto Equities ETF Flows Spot BTC ETFs: Spot ETH ETFs Source: Farside Investors Overnight Market Flows Chart of the Day While You Were Sleeping In the Ether