FTXs 16 Billion Payout Expected to Ignite Market Rally Unleashing 10x50x Crypto Gains Timeline
Bitcoin, currently in a bear market, has confirmed a weekly breakdown from its multi-month consolidation range. However, it remains in an uptrend as long as it stays above $38,000. During the early European session on Monday, Bitcoin’s price hovered around $55,422, while the fear and greed index dropped further towards 28, indicating more fear in the market.
The recent breakdown introduces the possibility of lower price targets for Bitcoin. However, for a return to the previous consolidation range, a weekly close back within the range would be required, which is less likely given the current close. The weekly Relative Strength Index (RSI) is approaching the August/September 2022 lows, and another red weekly candle could set up a potential bullish divergence.
In addition, for the first time since last October, Bitcoin’s price consistently closed below the 200-day Moving Average (MA) in the past five days. If Bitcoin reclaims the 200D SMA as a support level, it could increase the chances of a bullish recovery during the fourth quarter.
The recent bearish pressure on Bitcoin is attributed to increased selling by whales, with the German government offloading over $85 million in Bitcoin and US-based Bitcoin ETFs experiencing low demand. Miners are also selling BTC to cover costs. The market is now awaiting economic clarity from the US Federal Reserve, with expectations of a rate cut later this year and a general election that could potentially spark a crypto-bullish outlook.
Ash Crypto recently highlighted a major upcoming event that could drive the crypto market to new heights: the distribution of over $16 billion in stablecoin liquidity. This liquidity boost is a result of FTX’s plan to reimburse its creditors, which could pave the way for significant market growth in late 2024 and early 2025.
The key dates to watch are August 16, when FTX customers will vote on the distribution plan, and October 7, when Judge Dorsey will decide on its approval. If approved, the reimbursement process will begin in the fourth quarter of 2024 and continue into the first quarter of 2025.
This influx of funds coincides with other bullish market factors, such as potential rate cuts, new FASB accounting rules, and US election results, all of which could further boost the crypto market. Ash Crypto believes that this $16 billion injection will act as a powerful catalyst for higher crypto prices, with Bitcoin projected to surpass $120,000, Ethereum potentially climbing above $12,000, and many altcoins experiencing significant growth.
While the exact impact of this repayment is uncertain, it presents an opportunity for investors to capitalize on the upcoming market surge.