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What will drive the cryptocurrency market to grow in 2024-2025?
In a downtrend, cryptocurrency analyst Wise Advise in his X send highlighted a significant event that he believes will be the most substantial bullish catalyst for the cryptocurrency market in 2024-25. While discussions often center on the potential impacts of Trump’s presidential election victory, the highly anticipated Federal Reserve rate cuts, and new FASB regulations, he argues that a different factor will positively impact cryptocurrencies during this cycle.
Although Mt Gox has turned the market upside down, the bullish theory of analysts on the distribution of FTX funds will be an interesting prediction for investors who are worried about the prolonged cryptocurrency crisis.
Here’s what you need to know about this intriguing situation!
Distribution of FTX Funds
Wise Advice has identified the key event as FTX Planned Distribution of over $16 billion to its creditors, which is expected to happen between Q4 2024 and Q1 2025. He notes that most of the claims on FTX assets were made when the market was at its lowest. However, stablecoins like USDC and USDT will be distributed at their full value 1:1.
Market impact
Given the current bullish trend in the market, the redistribution of such a large amount of money will likely have a positive impact. Wise Advice points out that most of FTX’s lenders are already involved in the cryptocurrency space, which means that this $16 billion is likely to be reinvested into the market. This influx of liquidity could push Bitcoin and other altcoins to new highs. In particular, Dogecoin (DOGE) is highlighted as a currency that could benefit significantly from this redistribution.
Comparisons with other events
Additionally, the analyst minimizes the potential impacts of other events that are often cited as significant, such as the Mt. Gox Fund Distributions and government crypto sales. He refers to these events as mere “noise” compared to the upcoming FTX distribution, which he believes will be the real game-changer for the cryptocurrency market.
And now?
Despite the current downturn, the possibility of a 2024 crypto bull cycle top cannot be completely ruled out. Historical patterns of previous major bull cycles suggest that the rally is far from over. Some analysts argue that the 2024 cycle mirrors the 2017 cycle, which saw several 25-30 percent pullbacks before peaking at around $20,000.
Read also: Today’s Crypto News: House Set to Challenge Biden’s Veto of SAB 121
The future of the cryptocurrency market is uncertain. What are your predictions for the impact of this $16 billion distribution?