hodler

4 Feb 2026, 11:01

Here’s How US Funding Certainty Calmed Markets and Lifted Bitcoin

Bitcoin (BTC) slid to around $72,800 yesterday as U.S. lawmakers debated a stopgap funding package before rebounding once the House passed the bill on February 4, 2026, easing fears of a government shutdown. The quick turnaround showed how closely crypto prices still track U.S. political risk, even when no blockchain-specific news is involved. Shutdown Fears Ripple Through Crypto According to a February 4 post by on-chain analytics firm Santiment, the sell-off unfolded during U.S. trading hours while headlines pointed to a tight vote in the House. As uncertainty built, BTC quickly fell, triggering about $30 million in DeFi liquidations and mirroring a synchronized drop in the S&P 500 and even gold, an asset typically viewed as a safe haven. This correlation indicates traders were reducing exposure to volatile assets broadly due to the political standoff, not crypto-specific news. The concern centered on whether Congress would approve a roughly $1.2 trillion funding package to keep most federal agencies running through September 30. Failure would have led to a partial shutdown, delaying economic data and adding stress to an already cautious market. The tense vote saw Republican divisions, with one representative voting against the bill due to foreign aid provisions. However, the bill ultimately passed, averting a shutdown and causing markets to respond with immediate relief. Bitcoin bounced from its lows, climbing over 5% within hours, and the S&P 500 also recovered. According to Santiment, the speedy recovery showed that fears of political dysfunction, rather than a fundamental reevaluation of Bitcoin’s value, were behind the earlier sell-off. Broader Pressures on Bitcoin’s Price While the funding bill news provided a clear short-term catalyst, Bitcoin is still facing broader headwinds. Per data from CoinGecko, the asset is down nearly 14% in the last seven days and 17% for the month. A recently published analysis from Galaxy Digital pointed to deteriorating on-chain metrics, with research head Alex Thorn noting that 46% of Bitcoin’s circulating supply is now “underwater,” meaning it was last moved at higher prices, which can increase selling pressure. He also pointed out that there was a lack of significant accumulation by large holders. Furthermore, on February 3, reports that Iran was seeking to shift the format of nuclear talks with the U.S. contributed to another leg down in Bitcoin’s price, pushing it below $75,000 and burning at least $20 million worth of derivative positions. Additionally, some analysts like Doctor Profit have revised their downside targets, saying the cycle bottom could hit a range between $44,000 and $54,000. However, the key question is whether the resolution of the immediate U.S. political risk will be enough to reverse these negative technical and on-chain trends, or if BTC is still vulnerable to a deeper test of support. The post Here’s How US Funding Certainty Calmed Markets and Lifted Bitcoin appeared first on CryptoPotato .

4 Feb 2026, 11:00

EU sanction threats over Russia ties loom as Kyrgyzstan amends crypto rules

The authorities in Kyrgyzstan have updated the country’s digital-asset legislation to add specific terms for cryptocurrencies and stablecoins and regulate mining by state-controlled entities. The changes come after recent reports unveiled that the European Union is preparing to up the sanctions pressure on the Central Asia nation. The latter has been accused of helping Russia to circumvent Western restrictions, including through domestic crypto platforms, a locally issued ruble-pegged stablecoin, and its banking system. President takes control over issuing cryptocurrencies in Kyrgyzstan Kyrgyz President Sadyr Zhaparov has signed a bill amending the law “On Virtual Assets” to better regulate the country’s cryptocurrency sector. The new provisions introduce legal definitions for stablecoins and “tokens,” as cryptocurrencies have been officially described, local and regional media reported. They also regulate the government’s participation in digital currency mining, directly or through state-owned companies, aimed at building a national crypto reserve, supporting blockchain projects, and boosting the development of Kyrgyzstan’s digital economy. Requirements for other mining enterprises have been clarified as well. These businesses will be subject to mandatory registration and certification. Miners will have to inform the state about the crypto wallets they are using to accumulate the minted coins and meet a set of technical and fire safety standards. Under the refreshed legislation, the concrete procedures for issuance and circulation of cryptocurrencies will be determined by Zhaparov himself and his administration, the Rossiyskaya Gazeta newspaper noted in an article on Wednesday. The President has also been granted powers to launch pilot projects to test innovative services and technologies in the space. According to the amendments, only coins backed by other assets will be issued in Kyrgyzstan, and the process will be strictly regulated by the government. Kyrgyzstan to become Central Asia’s stablecoin hotspot Kyrgyzstan has already issued two stablecoins – the U.S. dollar-pegged USDKG and KGST, which is tied to the national fiat, the Kyrgyz som. Both are meant to be used for settlements, including international. USDKG, which was launched in November, is backed by gold, and the authorities in Bishkek hope it will strengthen Kazakhstan’s position in the global financial system and attract foreign capital and business. The KGST coin was developed as part of the country’s central bank digital currency (CBDC) project and is backed by reserves held in state-owned banks. The plan is to list both, initially on domestic and regional crypto exchanges and eventually on global platforms, according to the agency for blockchain development under the head of state. Another stablecoin, the ruble-pegged A7A5 , has created a lot of headaches for Kyrgyzstan. The coin was developed in Russia and is currently issued by a Kyrgyz-registered company. The crypto and related entities, including Kyrgyz platforms and banks, have been targeted with sanctions by the U.S., the EU, and the U.K. over its suspected use to bypass financial restrictions imposed on Russia in response to its invasion of Ukraine. Launched in early 2025, A7A5 now accounts for nearly half of the non-dollar stablecoin market. According to a recent study by the blockchain analytics firm Elliptic, the coin has processed over $100 billion worth of transactions in less than a year, as reported by Cryptopolitan. EU set to slap new sanctions on Kyrgyzstan The latest amendments to Kyrgyzstan’s crypto law come amid media reports that the European Union is preparing to hit Russia’s ally with new sanctions. Last week, Bloomberg revealed that the EU is considering ways to increase the pressure on Bishkek such as activating a mechanism to ban certain exports to the former Soviet republic. The measure allows Brussels to restrict the supply of sensitive goods to a given country. The mentioned categories in the case of Kyrgyzstan include machine tools and radio equipment. This week, the Kyrgyz government announced they are initiating consultations with the European Union as a reaction to the reported preparation of Russia-linked sanctions against the country. Deputy Prime Minister Daniyar Amangeldiev told local media that an online meeting with the EU Sanctions Envoy David O’Sullivan may take place soon. Amangeldiev noted the absence of an official confirmation of the media reports and insisted that Kyrgyzstan has already restricted its exports of dual-use goods, emphasizing he sees no grounds for European sanctions. If you're reading this, you’re already ahead. Stay there with our newsletter .

4 Feb 2026, 10:35

USD/CNY Forecast: Bank of America’s Surprising 6.7 Revision as Chinese Yuan Defies Expectations

BitcoinWorld USD/CNY Forecast: Bank of America’s Surprising 6.7 Revision as Chinese Yuan Defies Expectations NEW YORK, March 2025 – Bank of America has delivered a surprising revision to its USD/CNY forecast, now projecting the currency pair to reach 6.7 as the Chinese yuan demonstrates unexpected resilience against the US dollar. This significant adjustment comes amid shifting global economic currents and represents one of the most notable currency forecast revisions of the quarter. Market analysts are closely examining the underlying drivers behind this change, particularly given the yuan’s performance against broader market expectations. Bank of America’s USD/CNY Forecast Revision: Analyzing the 6.7 Target Bank of America’s research division announced its revised USD/CNY forecast on Tuesday, moving from its previous projection of 7.1 to a more optimistic 6.7 target. Consequently, this represents a substantial 5.6% adjustment in their currency outlook. The bank’s analysts cited multiple converging factors driving this change. Specifically, they pointed to China’s improving trade balance, which has shown consistent strength throughout the first quarter of 2025. Additionally, capital flow patterns have shifted noticeably, with increased foreign investment entering Chinese financial markets. Furthermore, monetary policy divergence between the Federal Reserve and People’s Bank of China has created favorable conditions for yuan appreciation. The revised forecast places Bank of America among the more bullish institutions regarding yuan performance. Comparatively, other major banks maintain more conservative projections. For instance, JPMorgan currently forecasts USD/CNY at 6.9, while Goldman Sachs maintains a 7.0 outlook. This divergence in analyst opinions highlights the complex dynamics influencing currency markets. Moreover, historical data reveals that yuan forecasts have frequently underestimated the currency’s resilience during periods of economic transition. Key Factors Behind the Forecast Adjustment Bank of America’s analysis identifies three primary drivers for their revised USD/CNY forecast. First, China’s current account surplus has expanded significantly, reaching $85 billion in the latest quarter. Second, foreign direct investment inflows have increased by 18% year-over-year. Third, relative interest rate differentials have narrowed as the Federal Reserve signals a more dovish stance. These factors collectively support a stronger yuan valuation against the dollar. Chinese Yuan Strength: Examining the Underlying Economic Drivers The Chinese yuan has demonstrated remarkable strength throughout early 2025, defying many analysts’ expectations. Several structural factors contribute to this performance. China’s manufacturing sector continues to show robust export growth, particularly in high-technology segments. Meanwhile, the country’s services sector expansion has accelerated, reaching 6.2% growth in the latest quarter. Additionally, policy measures supporting currency stability have proven effective. The People’s Bank of China has implemented targeted interventions that have bolstered market confidence without triggering significant capital controls. International trade dynamics further support yuan strength. China’s trade relationships have diversified substantially, with increased exports to emerging markets in Southeast Asia and Africa. Simultaneously, import substitution policies have reduced dependency on certain foreign goods. These developments have improved China’s terms of trade, creating natural support for the currency. Furthermore, the internationalization of the yuan continues progressing steadily, with several countries increasing their yuan reserves for trade settlements. Comparative Currency Forecasts: Major Banks’ USD/CNY Projections Financial Institution Previous Forecast Revised Forecast Change Percentage Bank of America 7.1 6.7 -5.6% JPMorgan Chase 7.0 6.9 -1.4% Goldman Sachs 7.2 7.0 -2.8% HSBC 7.0 6.8 -2.9% Citigroup 7.1 6.9 -2.8% Monetary Policy Divergence and Currency Impacts Monetary policy trajectories in the United States and China have created favorable conditions for yuan appreciation. The Federal Reserve has signaled potential rate cuts in response to moderating inflation, while the People’s Bank of China maintains a relatively stable policy stance. This divergence reduces the interest rate advantage previously supporting the US dollar. Consequently, capital flows have begun shifting toward yuan-denominated assets offering relatively attractive yields. Historical analysis shows that similar policy divergences have frequently preceded periods of yuan strength against the dollar. Global Market Implications of Yuan Appreciation The strengthening Chinese yuan carries significant implications for global financial markets and international trade. A stronger yuan makes Chinese exports relatively more expensive, potentially affecting global supply chains and pricing structures. However, it also increases Chinese consumers’ purchasing power for imported goods. Major trading partners are already adjusting their strategies in response to these currency movements. For example, European manufacturers have reported increased competitiveness in certain market segments where Chinese products face price pressure from currency appreciation. Emerging market currencies often correlate with yuan movements, creating broader regional impacts. Southeast Asian currencies have shown increased stability as yuan strength provides regional support. Meanwhile, commodity markets experience mixed effects. Dollar-denominated commodities become relatively cheaper for Chinese buyers, potentially supporting demand. However, Chinese commodity exports face pricing challenges in international markets. These complex interactions demonstrate how currency movements transmit through global economic networks. Export Competitiveness: Chinese manufacturers adapt through efficiency improvements and product innovation Import Dynamics: Increased purchasing power supports Chinese demand for foreign goods and services Capital Flows: Foreign investment in Chinese assets becomes more attractive as currency appreciation offers potential gains Debt Servicing: Dollar-denominated debt becomes relatively cheaper for Chinese corporations Historical Context and Future Trajectory The current USD/CNY forecast revision occurs within a broader historical context of yuan internationalization. Since China’s accession to the World Trade Organization, the yuan has experienced multiple appreciation cycles interspersed with periods of stability. The current phase appears driven by fundamental economic factors rather than short-term speculative flows. Looking forward, analysts anticipate continued but gradual yuan appreciation, supported by China’s economic rebalancing toward domestic consumption and technological advancement. However, policymakers remain vigilant against excessive volatility that could disrupt economic stability. Expert Analysis and Market Reactions Financial market participants have responded cautiously to Bank of America’s USD/CNY forecast revision. Currency traders report increased two-way flows as investors reassess their positions. Meanwhile, corporate treasuries are reviewing their hedging strategies in light of the revised outlook. Several multinational corporations with significant China exposure have indicated they may adjust their currency risk management approaches. Derivatives markets show increased activity in yuan options, reflecting growing uncertainty about future currency movements. Independent analysts offer varied perspectives on the forecast revision. Some support Bank of America’s analysis, citing improving Chinese economic fundamentals. Others express caution, noting potential headwinds including geopolitical tensions and domestic debt challenges. This diversity of opinion reflects the complex factors influencing currency valuations in the current global environment. Market participants generally agree that currency forecasts require continuous reassessment as new data emerges and conditions evolve. Technical Analysis and Trading Patterns Technical analysts observe that USD/CNY has broken through several key resistance levels in recent weeks. The currency pair now trades near its lowest levels since early 2024, suggesting sustained downward momentum. Trading volumes have increased significantly, indicating broad market participation in the move. Chart patterns suggest potential support around the 6.75 level, with further downside possible if economic fundamentals continue supporting yuan strength. Options market pricing indicates increased expectations for yuan appreciation over the coming months, though with substantial dispersion around specific targets. Conclusion Bank of America’s revised USD/CNY forecast to 6.7 represents a significant reassessment of yuan prospects amid changing global economic conditions. The Chinese yuan’s demonstrated strength reflects multiple supporting factors including trade dynamics, capital flows, and monetary policy developments. While forecasts vary among financial institutions, the general direction suggests increased confidence in yuan stability and potential appreciation. Market participants should monitor evolving conditions closely, as currency movements will continue influencing global trade patterns, investment flows, and economic relationships. The USD/CNY forecast revision highlights the ongoing rebalancing in global currency markets as economic fundamentals shift across major economies. FAQs Q1: What does Bank of America’s USD/CNY forecast revision to 6.7 mean for currency traders? Currency traders should recognize this revision signals increased expectations for yuan appreciation against the dollar. Consequently, they may adjust their positioning accordingly, potentially increasing long yuan exposure or reducing dollar holdings in their portfolios. Q2: How does yuan strength affect Chinese exports? A stronger yuan makes Chinese exports more expensive in foreign markets, potentially reducing competitiveness. However, Chinese exporters often respond through efficiency improvements, product innovation, and supply chain optimization to mitigate these effects. Q3: What factors typically drive USD/CNY exchange rate movements? Key drivers include trade balances, interest rate differentials, capital flows, economic growth disparities, monetary policies, and geopolitical developments. Additionally, market sentiment and technical factors influence short-term movements. Q4: How reliable are major bank currency forecasts? While based on extensive analysis, currency forecasts have limited reliability due to market complexity and unexpected developments. They serve as informed guidance rather than precise predictions, requiring continuous updating as conditions change. Q5: What implications does yuan appreciation have for global financial markets? Yuan appreciation affects international trade competitiveness, commodity prices, emerging market currencies, and global capital allocation patterns. It may also influence inflation dynamics in countries trading extensively with China. This post USD/CNY Forecast: Bank of America’s Surprising 6.7 Revision as Chinese Yuan Defies Expectations first appeared on BitcoinWorld .

4 Feb 2026, 09:25

Dollar Steadies After Hefty Gains; Euro Awaits Critical Inflation Release That Could Reshape Markets

BitcoinWorld Dollar Steadies After Hefty Gains; Euro Awaits Critical Inflation Release That Could Reshape Markets Global currency markets entered a period of cautious stability on Thursday, March 13, 2025, as the US dollar consolidated its recent substantial gains while European traders awaited a pivotal inflation release that could determine the euro’s trajectory for the coming quarter. This pause in dollar momentum follows a remarkable two-week rally that saw the currency index climb 2.8% against major counterparts, driven by shifting expectations about Federal Reserve policy and relative economic strength. Meanwhile, market participants globally focused their attention on the Eurozone’s upcoming Consumer Price Index (CPI) data, scheduled for release at 10:00 GMT from Frankfurt, Germany. The inflation figures carry particular significance this month as they precede the European Central Bank’s next policy meeting and could signal whether the region’s disinflation process remains on track or faces unexpected setbacks. Dollar Consolidates After Impressive Rally The US Dollar Index (DXY), which measures the greenback against a basket of six major currencies, traded within a narrow 0.3% range during the Asian and early European sessions. This consolidation followed a significant 2.8% appreciation over the preceding fourteen trading days. Market analysts attribute the dollar’s recent strength to several interconnected factors. First, stronger-than-expected US retail sales data released last week suggested American consumers remain resilient despite higher interest rates. Second, comments from Federal Reserve officials indicated a more cautious approach to rate cuts than markets had previously anticipated. Third, geopolitical tensions in several regions boosted demand for the dollar as a traditional safe-haven asset. According to trading data from major financial institutions, the dollar’s gains were particularly pronounced against the Japanese yen and Swiss franc. However, the currency showed more measured movement against the euro and British pound. This selective strength pattern reflects differentiated monetary policy expectations across major economies. Notably, the dollar’s stabilization occurred despite a modest pullback in US Treasury yields, which typically move in tandem with currency valuations. The 10-year Treasury yield retreated 5 basis points to 4.18% overnight, yet dollar selling remained contained as traders awaited clearer directional signals. Technical Analysis and Market Positioning Technical analysts highlight that the dollar index now faces immediate resistance at the 105.50 level, a threshold it last tested in November 2024. Support appears firm around 104.80, where substantial buying emerged during yesterday’s session. Commitment of Traders (COT) reports from the Commodity Futures Trading Commission reveal that speculative net long positions on the dollar reached their highest level since January 2024. This positioning suggests that further dollar appreciation might require fresh catalysts, as many bullish bets have already been placed. Market liquidity conditions remain normal, with no significant disruptions reported across major trading hubs in London, New York, or Tokyo. Eurozone Inflation Data Takes Center Stage All eyes now turn to the Eurozone’s harmonized index of consumer prices (HICP), scheduled for release at 10:00 GMT from Eurostat headquarters in Luxembourg. Economists surveyed by major financial institutions project headline inflation will ease to 2.1% year-over-year in February, down from 2.3% in January. More critically, core inflation—which excludes volatile food and energy prices—is expected to decline to 2.5% from 2.7%. These projections, if realized, would bring eurozone inflation closer to the European Central Bank’s 2% target. However, recent surprises in national data from Germany, France, and Spain have created uncertainty about the aggregate figures. The inflation release carries substantial implications for ECB monetary policy. President Christine Lagarde stated clearly last month that the Governing Council needs “confidence that inflation is converging sustainably to our target” before considering rate cuts. Market pricing currently suggests a 65% probability of a 25-basis-point cut at the June meeting, with expectations for a total of 75 basis points in reductions during 2025. A significant deviation from inflation forecasts could dramatically alter this outlook. Specifically, higher-than-expected figures might push rate cut expectations further into the future, potentially supporting the euro. Conversely, lower inflation could accelerate expectations for monetary easing, placing downward pressure on the common currency. Eurozone Inflation Forecasts for February 2025 Indicator January 2025 February Forecast ECB Target Headline HICP 2.3% 2.1% 2.0% Core HICP 2.7% 2.5% 2.0% Services Inflation 3.1% 2.9% N/A Energy Inflation -0.8% -1.2% N/A National Data Provides Mixed Signals Preliminary inflation data from Eurozone member states presents a complex picture. Germany’s February CPI came in at 2.2%, slightly below expectations but showing persistent services inflation at 3.3%. France reported 2.4% inflation, with food prices remaining elevated. Spain surprised to the upside with 2.6% inflation, driven by tourism-related services. Italy’s data is pending but expected around 2.3%. These national variations complicate the aggregate forecast and highlight the challenge of implementing uniform monetary policy across diverse economies. Services inflation—a key concern for ECB policymakers—remains stubbornly above 3% in several major economies, suggesting underlying price pressures persist despite overall disinflation. Broader Market Context and Global Implications The dollar-euro dynamics occur within a broader global financial landscape characterized by three significant trends. First, central bank divergence remains a dominant theme, with the Federal Reserve, European Central Bank, and Bank of England on different policy trajectories. Second, geopolitical tensions continue to influence currency flows, particularly affecting commodity-linked currencies and safe-haven assets. Third, structural changes in global trade patterns are gradually altering traditional currency relationships. These factors combine to create a complex environment for currency traders and multinational corporations managing foreign exchange exposure. Other major currencies showed varied performance during the session. The British pound traded slightly lower against the dollar but held gains against the euro, supported by stronger UK wage growth data released yesterday. The Japanese yen remained near multi-decade lows against the dollar, with the USD/JPY pair trading around 152.50. Bank of Japan officials have made increasingly vocal comments about potential intervention, though concrete action has yet to materialize. Meanwhile, commodity currencies like the Australian and Canadian dollars showed modest gains, supported by firmer oil and industrial metal prices. Federal Reserve Policy: The Fed’s March meeting minutes revealed continued concern about persistent services inflation ECB Communication: Recent speeches suggest growing divergence among Governing Council members about timing of rate cuts Economic Growth: US GDP growth forecasts for Q1 2025 exceed Eurozone projections by approximately 1.5 percentage points Trade Flows: Recent data shows narrowing US trade deficit, providing fundamental support for the dollar Expert Perspectives on Currency Outlook Financial institution research departments offer nuanced views on near-term currency movements. Goldman Sachs analysts note that “the dollar’s valuation appears stretched relative to fundamentals, suggesting limited upside from current levels.” Meanwhile, Deutsche Bank strategists argue that “relative monetary policy paths still favor the dollar, particularly if US economic resilience persists.” Independent analysts highlight that positioning data shows extreme dollar bullishness, which often precedes reversals. Historical analysis indicates that currency trends following inflation surprises tend to persist for approximately two to three weeks before other factors reassert influence. Practical Implications for Businesses and Investors The current currency environment presents both challenges and opportunities for various market participants. Multinational corporations face increased hedging costs due to elevated volatility, particularly for euro-dollar exposures. Exporters in the Eurozone benefit from a weaker euro, though this advantage may diminish if the currency appreciates following favorable inflation data. Importers in the United States face higher costs for European goods when the dollar weakens. Portfolio managers must carefully assess currency impacts on international investments, as unhedged positions have produced significant return variations in recent quarters. For retail investors, currency movements affect international purchasing power and investment returns. A stronger dollar reduces the cost of imported goods and foreign travel for Americans but diminishes returns on international investments when converted back to dollars. European investors face the opposite dynamic. Financial advisors typically recommend currency-hedged investment products during periods of elevated volatility and uncertain directionality. However, long-term investors often maintain unhedged positions to benefit from natural diversification effects across economic cycles. Conclusion The dollar’s stabilization after recent substantial gains reflects typical market behavior following extended moves, while the euro’s fate hinges on imminent inflation data that could reshape monetary policy expectations. Today’s Eurozone CPI release represents a critical juncture for currency markets, potentially determining whether the dollar resumes its upward trajectory or the euro mounts a sustained recovery. Regardless of the immediate outcome, the broader context of central bank divergence, economic resilience differentials, and geopolitical uncertainty suggests continued volatility in forex markets. Market participants should prepare for multiple scenarios, as currency movements will likely remain sensitive to economic data surprises and central bank communications in the coming weeks. The dollar’s recent performance and the euro’s pending inflation test together highlight the complex interplay between monetary policy expectations and currency valuations in today’s global financial system. FAQs Q1: What caused the US dollar’s recent gains against other major currencies? The dollar appreciated due to stronger-than-expected US economic data, cautious Federal Reserve communications about rate cuts, and safe-haven demand amid geopolitical tensions. These factors combined to shift market expectations toward delayed monetary easing in the United States relative to other major economies. Q2: Why is the Eurozone inflation data so important for currency markets? Inflation data directly influences European Central Bank policy decisions. Higher inflation would likely delay expected interest rate cuts, potentially strengthening the euro. Lower inflation could accelerate monetary easing expectations, placing downward pressure on the common currency against the dollar and other majors. Q3: How do currency movements affect everyday consumers? Currency fluctuations impact international purchasing power. A stronger dollar makes imported goods and foreign travel cheaper for Americans but more expensive for foreigners buying US products. Conversely, a weaker dollar has the opposite effects, influencing prices consumers pay for imported goods and services. Q4: What technical levels are traders watching for the US dollar index? Traders monitor immediate resistance at 105.50, a level last tested in November 2024. Support appears around 104.80, where substantial buying emerged recently. Breaks above or below these levels could signal the next directional move for the dollar against its major counterparts. Q5: How might today’s data affect broader financial markets beyond currencies? Significant inflation surprises could impact global bond yields, equity valuations, and commodity prices. Higher-than-expected Eurozone inflation might push European bond yields higher, potentially affecting borrowing costs globally. Currency movements also influence multinational corporate earnings and emerging market debt servicing costs. This post Dollar Steadies After Hefty Gains; Euro Awaits Critical Inflation Release That Could Reshape Markets first appeared on BitcoinWorld .

4 Feb 2026, 09:00

Bitwise CIO Warns Market Is Facing A ‘Full-Bore’ Crypto Winter, Not A Pullback

Bitwise Chief Investment Officer Matt Hougan has released a new analysis of the current state of the crypto market, arguing that the industry has been firmly entrenched in a bear market for over a year. In a report shared on social media, Hougan stated that his research indicates the current downturn began as early as January 2025, despite widespread optimism fueled by institutional adoption, regulatory progress, and Bitcoin’s (BTC) rally to new all-time highs. Deep Bear Market Driving Crypto? Posting on X, formerly Twitter, Hougan pushed back against the idea that recent price weakness represents a routine pullback or short‑term dip. Instead, he described the current environment as a full‑scale crypto winter comparable to past downturns in 2018 and 2022. Interestingly, Hougan said the crypto market currently resembles a “2022‑like, Leonardo‑DiCaprio‑in‑The‑Revenant‑style” winter, driven by excessive leverage built up during the prior cycle and heavy profit‑taking by long‑time crypto holders. Related Reading: What’s Next For Bitcoin? Two Key Scenarios: Will It Crash To $60,000 Or Surge To $100,000? Hougan addressed a question many investors have been asking: why prices continue to fall despite a steady stream of positive developments. He pointed to expanding institutional involvement, improving regulation, and broader adoption as clear long‑term positives, but said none of that typically matters during the deepest phase of a bear market. According to Hougan, crypto winters are periods when good news is largely ignored, regardless of its significance. Even developments such as Wall Street firms hiring aggressively or major banks like Morgan Stanley increasing their crypto exposure are unlikely to spark a rally in the short term. He also cited market sentiment indicators to support his view. Hougan noted that the Crypto Fear and Greed Index remains near historically high levels of fear, even as the newly appointed Federal Reserve (Fed) chair is publicly supportive of Bitcoin. To him, this disconnect underscores how deeply negative sentiment has become. Drawing on past cycles, Hougan said crypto winters rarely end with renewed excitement or optimism. Instead, they typically conclude when investors are exhausted and disengaged. ETF Support Propped Up Bitcoin? Looking to history, Hougan observed that previous crypto winters have lasted roughly 13 months. Bitcoin reached its peak in December 2017 before bottoming a year later, and again peaked in October 2021 before hitting its low point in November 2022. By that measure, the current cycle might suggest more pain ahead, particularly since Bitcoin peaked again in October 2025. However, Hougan argued that focusing solely on that date misses a critical detail. In his view, the current winter actually began in January 2025 but was partially hidden by extraordinary institutional inflows. He said strong demand from exchange‑traded funds (ETFs) and Digital Asset Treasuries (DATs) masked underlying weakness across much of the crypto market. Hougan emphasized the scale of institutional support for Bitcoin in particular, calling it unprecedented. During the period he analyzed, ETFs and DATs collectively purchased more than 744,000 BTC, representing roughly $75 billion in buying pressure. He suggested that without this support, BTC’s price could have fallen by as much as 60%. Related Reading: Hyperliquid Unveils HIP‑4, Sending HYPE 14% Higher On Outcome Trading Plans Despite this, Bitwise CIO suggested several possible catalysts that could help lift sentiment and mark the beginning of a crypto recovery, including strong global economic growth that reignites risk appetite, progress on the CLARITY Act, early signs of sovereign adoption of Bitcoin, or simply the passage of time. Reflecting on his experience through multiple crypto market cycles, he said the current mood of despair, fatigue, and malaise closely resembles the final stages of past crypto winters. Featured image from OpenArt, chart from TradingView.com

4 Feb 2026, 08:25

Bitcoin Bull Run: The Final Surge Predicted Within 3 Years as Macroeconomic Tides Turn

BitcoinWorld Bitcoin Bull Run: The Final Surge Predicted Within 3 Years as Macroeconomic Tides Turn A significant macroeconomic shift could trigger Bitcoin’s final explosive bull run within the next three years, according to prominent cryptocurrency analyst Michaël van de Poppe. His analysis, published this week, points to converging economic indicators that historically favor Bitcoin’s price appreciation. Meanwhile, other experts like Benjamin Cowen offer contrasting perspectives on these predictive models, creating a nuanced debate within financial circles. This potential transition comes as global markets navigate post-pandemic recovery phases and central banks reconsider monetary policies. Bitcoin Bull Run: The Macroeconomic Catalyst Theory Michaël van de Poppe identifies several interconnected economic signals suggesting favorable conditions for Bitcoin. The U.S. ISM Manufacturing Purchasing Managers’ Index (PMI) approaching the critical 50 threshold represents a primary indicator. This measurement reflects economic expansion when above 50 and contraction when below. After three consecutive years below this expansion line, crossing above 50 would signal manufacturing sector recovery. Van de Poppe notes Bitcoin’s resilience during negative business cycles, attributing recent strength to two key developments: Spot Bitcoin ETF approvals creating institutional access channels Available market liquidity despite tightening conditions These factors demonstrate Bitcoin’s evolving role as both a risk asset and potential hedge. The analyst’s framework connects traditional economic indicators with cryptocurrency market behavior, establishing predictive relationships between conventional finance and digital assets. Federal Reserve Policy and Precious Metal Signals The Federal Reserve’s potential policy pivot represents another crucial element in this analysis. Van de Poppe anticipates the conclusion of quantitative tightening (QT) and the beginning of quantitative easing (QE) alongside interest rate reductions. Such monetary policy shifts typically increase liquidity within financial systems, potentially benefiting alternative assets like Bitcoin. Recent precious metal movements provide additional context. Gold and silver achieved new price highs last week, suggesting possible inflationary concerns or currency devaluation fears among traditional investors. These parallel movements across different asset classes often indicate broader economic transitions rather than isolated market events. Key Economic Indicators and Bitcoin Correlation Indicator Current Status Historical Bitcoin Impact ISM Manufacturing PMI Approaching 50 threshold Positive correlation during expansion phases Federal Reserve Policy Potential shift from QT to QE Increased liquidity typically benefits BTC Precious Metal Prices Gold and silver at new highs Parallel movements suggest macro shifts Business Cycle Position Transition from negative to potentially positive BTC has shown resilience during contractions The Counter Perspective: Questioning Indicator Reliability Benjamin Cowen, founder of Into The Cryptoverse, challenges the predictive relationship between ISM data and Bitcoin prices. His analysis suggests insufficient historical correlation to establish reliable forecasting models. Cowen emphasizes Bitcoin’s unique market dynamics, which sometimes decouple from traditional economic indicators. This debate highlights cryptocurrency analysis’ evolving nature as practitioners integrate conventional economic tools with digital asset-specific metrics. The disagreement reflects broader questions about Bitcoin’s maturation within global financial systems and appropriate analytical frameworks for emerging asset classes. Historical Context and Market Cycle Analysis Bitcoin’s market behavior exhibits distinct cyclical patterns since its 2009 inception. Previous bull runs typically followed halving events, occurring approximately every four years. The next halving is projected for 2024, potentially aligning with van de Poppe’s three-year bull run window. This timing creates interesting convergence between Bitcoin’s internal supply mechanics and external macroeconomic conditions. Several factors distinguish the current market environment from previous cycles: Institutional adoption through regulated financial products Regulatory clarity in major markets like the United States Macroeconomic uncertainty following pandemic disruptions Technological developments including layer-2 solutions and smart contract capabilities These developments suggest potential for different market dynamics compared to previous cycles. The “final bull run” concept implies possible maturation toward more stable long-term valuation patterns afterward. Potential Economic Depression Scenario Van de Poppe’s analysis includes a concerning macroeconomic projection: the potential final bull market preceding a major economic depression. This perspective aligns with certain economic theories suggesting extended periods of monetary stimulus eventually require painful corrections. Bitcoin’s potential role during such scenarios remains debated within economic circles. Historical precedent shows Bitcoin’s mixed performance during economic stress. The 2020 pandemic crash saw Bitcoin decline sharply before recovering dramatically. This volatility demonstrates both correlation and decoupling patterns relative to traditional markets during crisis periods. The asset’s eventual behavior during sustained economic depression would provide crucial data about its hedging properties. Analytical Methodology and Evidence Standards Evaluating these predictions requires understanding analytical methodologies. Technical analysts like van de Poppe typically examine chart patterns, indicators, and historical correlations. Fundamental analysts might focus on adoption metrics, network activity, and macroeconomic conditions. Quantitative analysts employ statistical models and algorithmic approaches. The ISM PMI debate exemplifies methodological differences. While some analysts find meaningful correlations, others question statistical significance over sufficient timeframes. This ongoing methodological development reflects cryptocurrency analysis’ relative youth compared to traditional financial analysis with centuries of established practice. Conclusion The predicted Bitcoin bull run within three years rests on converging macroeconomic signals and internal market cycles. Michaël van de Poppe’s analysis connects Federal Reserve policy, manufacturing indicators, and precious metal movements to forecast favorable Bitcoin conditions. Benjamin Cowen’s counterarguments highlight ongoing debates about appropriate analytical frameworks for cryptocurrency markets. As global economies navigate post-pandemic adjustments and monetary policy transitions, Bitcoin’s role continues evolving within broader financial ecosystems. Investors should consider multiple analytical perspectives while recognizing cryptocurrency markets’ inherent volatility and unpredictability. FAQs Q1: What is the ISM Manufacturing PMI and why does it matter for Bitcoin? The Institute for Supply Management’s Purchasing Managers’ Index measures manufacturing sector health. Values above 50 indicate expansion while below 50 suggests contraction. Some analysts believe economic expansion phases create favorable conditions for Bitcoin appreciation. Q2: How might Federal Reserve policy changes affect Bitcoin prices? Transitioning from quantitative tightening to quantitative easing typically increases monetary supply. This additional liquidity often flows into various asset classes, potentially including cryptocurrencies like Bitcoin as alternative investments. Q3: What does “final bull run” mean in this context? The analyst suggests this could be Bitcoin’s last explosive price surge before achieving more stable, mature market behavior. This theory assumes eventual market maturation similar to other asset classes’ developmental trajectories. Q4: Why are gold and silver prices relevant to Bitcoin analysis? Precious metals traditionally serve as inflation hedges and safe-haven assets. Parallel movements between metals and Bitcoin might indicate shared responses to macroeconomic conditions or shifting perceptions about traditional versus alternative stores of value. Q5: How reliable are these cryptocurrency price predictions? All financial predictions involve uncertainty, particularly for volatile emerging assets like cryptocurrencies. Different analysts employ varying methodologies with mixed historical accuracy. Investors should consider multiple perspectives and conduct independent research before making financial decisions. This post Bitcoin Bull Run: The Final Surge Predicted Within 3 Years as Macroeconomic Tides Turn first appeared on BitcoinWorld .