$BTC Peach once again predicted the market downturn a few days ago. With the Democratic Party in control of Congress, things may not be so easy for crypto going forward.
This time, the market is facing more than just one negative factor—macroeconomic policy and regulatory risks are hitting at the same time!
First, the most striking data: the U.S. added 165,000 nonfarm jobs in October, far above market expectations of 65,000, while the unemployment rate fell to 4.1%. The labor market is stronger than expected, which gives the Federal Reserve more reason to keep raising rates. LSEG data shows that bets on a 25-basis-point rate hike in December have climbed to nearly 80%.
Now for the political landscape: with the Democratic Party in control of Congress, the market is growing concerned that crypto industry regulations could tighten, while AI data centers and tech companies may also face stricter policy scrutiny. Investors used to chase policy tailwinds; now they’re worried about policy tightening!
That’s the most troubling part: on one hand, rising rate-hike expectations are putting pressure on risk assets through the dollar and Treasury yields; on the other, growing regulatory uncertainty is naturally making institutional investors reluctant to jump in.
So don’t expect another major crypto bull run to come easily anytime soon!
My view is that the broader market will remain bearish in the short term, and even rallies could be opportunities for investors to sell into strength. Next, keep a close eye on U.S. CPI, the Fed’s December policy decision, and ETF flows. Until these pressures ease, it will remain very difficult for BTC and ETH to sustain a strong rally.
This time, the market is facing more than just one negative factor—macroeconomic policy and regulatory risks are hitting at the same time!
First, the most striking data: the U.S. added 165,000 nonfarm jobs in October, far above market expectations of 65,000, while the unemployment rate fell to 4.1%. The labor market is stronger than expected, which gives the Federal Reserve more reason to keep raising rates. LSEG data shows that bets on a 25-basis-point rate hike in December have climbed to nearly 80%.
Now for the political landscape: with the Democratic Party in control of Congress, the market is growing concerned that crypto industry regulations could tighten, while AI data centers and tech companies may also face stricter policy scrutiny. Investors used to chase policy tailwinds; now they’re worried about policy tightening!
That’s the most troubling part: on one hand, rising rate-hike expectations are putting pressure on risk assets through the dollar and Treasury yields; on the other, growing regulatory uncertainty is naturally making institutional investors reluctant to jump in.
So don’t expect another major crypto bull run to come easily anytime soon!
My view is that the broader market will remain bearish in the short term, and even rallies could be opportunities for investors to sell into strength. Next, keep a close eye on U.S. CPI, the Fed’s December policy decision, and ETF flows. Until these pressures ease, it will remain very difficult for BTC and ETH to sustain a strong rally.
