Bitfinex exchange recently stated in a report that the cryptocurrency market might experience significant volatility within three days following the results of the U.S. election. However, since Bitcoin has absorbed most of the market’s funds during this bull run, the likelihood of a substantial rebound in altcoins might not be high.
(Previous Context:
Bitcoin is on the rise, so why is the Web3 sector experiencing waves of layoffs?
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(Background Supplement:
Is the decline over? Bitcoin rebounds after dipping to $67,500, with the U.S. presidential election and the Federal Reserve’s rate decisions looming…
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Bitcoin reached a new all-time high of $75,242 at around 11:05 today, marking an 8.8% increase over the past 24 hours. It slightly retreated to the $74,000 level before the article’s deadline, so investors should be cautious of volatility.
Bitfinex: Market to Experience Intense Volatility from November 5 to 8
Regarding this background, cryptocurrency exchange Bitfinex recently released a research report indicating that last week’s rise was driven by the so-called “Trump trade,” as the market previously believed Trump’s winning odds were significantly ahead of his opponent Kamala Harris, thereby boosting Bitcoin buying. However, as Trump’s odds decreased and U.S. election uncertainties deepened, Bitcoin’s rise encountered resistance.
On the eve of the election results (Taiwan time November 6), as market predictions showed a decline in Trump’s odds, the implied volatility in the options market remained relatively calm, suggesting that investors are currently in a wait-and-see mode until everything settles.
Nevertheless, Bitfinex predicts that with the announcement of the U.S. election results and the upcoming Federal Reserve’s November rate decision, market volatility will significantly increase during the period from November 5 to 8.
Bleak Prospects for Altcoin Rebound
On the other hand, although the market generally believes Bitcoin is on an upward trend in the long term, Bitfinex points out that investors seem to have lost their previous speculative interest in altcoins. Even if a large portion of funds is drawn into the cryptocurrency market, most of it is still being absorbed by Bitcoin:
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