The Crypto Market Has the Potential to Rally Again, Here are the Factors!

Bittime – The crypto market has experienced significant fluctuations in recent months, but there are strong indications that a major rally may be on the way again. 

Several key factors could drive a surge in crypto asset prices, including falling inflation, looser monetary policy, and increased global liquidity. 

This article will discuss these factors in detail and why they have the potential to take the crypto market to greater heights.

Declining Inflation: Impact on Crypto Markets

One of the main factors that could drive a rally in the crypto market is a decrease in inflation. Recently, Consumer Price Index (CPI) data showed that inflation has fallen below 3%, a significant achievement by the Federal Reserve (The Fed). 

While this number is psychologically important, its impact on the crypto market could be more profound. 

A decline in inflation is often associated with looser monetary policy, which in turn can encourage funds to flow into riskier assets such as Bitcoin and other cryptocurrencies.

Lyn Alden, a leading macro analyst, stressed that while these inflation numbers are important, the real challenge is whether the Fed can keep inflation at these low levels while still easing monetary policy. 

If they succeed, this could be a major catalyst for the crypto market to experience further upside.

Looser Monetary Policy: Opportunities for Crypto

Another factor that could drive a rally in the crypto market is the potential easing of monetary policy by the Fed. There is speculation that the Fed may start lowering interest rates in September, which could provide an additional boost to the digital asset market. 

A drop in interest rates is often accompanied by increased liquidity in financial markets, which can benefit Bitcoin and other crypto assets.

Lyn Alden said that although the impact of the interest rate cut may not be immediately felt in the US domestic market, it could provide relief for emerging markets that have debt in dollars. 

Thus, this monetary easing could create a positive liquidity cycle that would benefit the crypto market as a whole.

Increased Global Liquidity: A Major Catalyst for Bitcoin

Global liquidity is one of the most significant factors in determining the direction of Bitcoin's price. According to Alden, there are two main components in global liquidity: the rate of credit formation and the strength of the dollar. 

As global liquidity increases, this tends to have a positive impact on Bitcoin prices. Alden predicts that in the next few years, we may see another positive liquidity cycle. 

After a period of stagnation due to tightening policies by central banks, there will likely be a significant increase in liquidity, which will push the prices of Bitcoin and other crypto assets up.

Value Stability: Bitcoin vs. Bitcoin Stablecoins

In a volatile market environment, many investors are looking for a safe place to store value. Bitcoin is often viewed as a superior store of value, primarily due to its finite and non-inflationary nature. 

However, stablecoins also play an important role, especially for investors who want to avoid high volatility.

According to Alden, both Bitcoin and stablecoins have an important role in the crypto market. Bitcoin, with its more speculative nature, often attracts investors willing to take on higher risks. 

On the other hand, stablecoins such as USDT and USDC offer stability for those who need a more stable account unit for trading or daily transactions.

Future Projections: What Can We Expect?

Looking ahead, the crypto market appears to be on the verge of another major rally, driven by a combination of factors such as falling inflation, looser monetary policy, and increased global liquidity. 

While there is no guarantee that this rally will occur, current indicators suggest strong potential. 

Additionally, the growing stablecoin network, with the entry of big players like PayPal with its PUSD, shows that crypto adoption continues to increase. 

This provides additional support for the crypto market, as more and more people enter the crypto ecosystem, both through Bitcoin and stablecoins.

Conclusion

The crypto market is at a critical point where a major rally could occur at any time. Factors such as decreasing inflation, looser monetary policy, and increasing global liquidity all provide indications that the price of Bitcoin and other crypto assets could soar in the near future. 

However, as always, investors should always exercise caution and consider the risks before making any investment decisions.

How to Buy Crypto on Bittime

You can buy and sell crypto assets easily and safely via Bittime. Bittime is one of Indonesia's best crypto applications, officially registered with Bappebti. 

To be able to buy crypto assets on Bittime, make sure you have registered and completed identity verification. Apart from that, also ensure you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application. Study Complete Guide How to Buy Crypto on Bittime. 

Monitor graphic movement of Bitcoin (BTC) price, Ethereum (ETH), Solana (SOL), and other cryptos to find out today's crypto market trends in real-time on Bittime.