October 2 Crypto News – Bitcoin Prepares for Year-End Rally Despite Market Volatility

October 2 Crypto News – Bitcoin Faces Uncertainty Ahead of U.S. Election and FTX Payouts

October 2 Crypto News – Bitcoin is preparing for a potential rally in the final months of this year, driven by several important developments that could provide much-needed market support, according to analysts.

Despite a 4% drop on Tuesday following Iran’s missile strike on Israel, Bitcoin (BTC) has since recovered from two-week lows, rising above $61,500 after hitting a low of $60,300.

Geopolitical Tensions Impact Markets

The sharp decline followed Iran’s launch of more than 180 ballistic missiles at Israel in retaliation for Israeli strikes on Hezbollah positions in Lebanon. According to state media, the attack marked Iran’s first use of hypersonic Fattah missiles.

Major U.S. stock indices also saw declines, with the Nasdaq Composite falling 1.53%, the S&P 500 down 0.93%, and the Dow Jones Industrial Average dropping 0.41%.

Despite these challenges, analysts at K33 Research, Vetle Lunde and David Zimmerman, highlight four major tailwinds that could help Bitcoin rebound.

China’s Stimulus Measures to Boost Global Liquidity

One of the primary factors supporting Bitcoin’s potential rally is China’s aggressive stimulus measures. The People’s Bank of China introduced a series of rate cuts and rolled out a $142 billion stimulus package last month, aimed at averting recession and stimulating growth.

These moves are expected to improve global liquidity, which typically benefits speculative assets like Bitcoin.

Upcoming U.S. Employment Data Could Influence Bitcoin’s Trajectory

Another key factor is the upcoming release of U.S. employment data on Friday. With Bitcoin’s correlation to U.S. equities reaching multi-year highs, employment figures are expected to influence interest rate expectations and market sentiment.

Analysts predict that 150,000 jobs will have been added to nonfarm payrolls in September, up from 142,000 in August. A positive outlook here could bolster Bitcoin as investors reassess the broader macroeconomic environment.

U.S. Presidential Election Adds Uncertainty to the Market

The U.S. presidential election, scheduled for November 5, is also expected to play a role in Bitcoin’s future performance. Candidates Vice President Kamala Harris and former President Donald Trump are vying for the presidency, and market analysts predict that a Trump victory could boost Bitcoin due to his favorable stance on the crypto industry.

However, a Harris win may lead to a short-term negative reaction, given her administration’s anticipated regulatory approach toward digital assets.

“Markets don’t like uncertainty, and for an emerging industry like crypto, the uncertainty of the November elections will be an overhang,” said Samir Kerbage, Chief Investment Officer at Hashdex. Regardless of the outcome, the election could pave the way for a more favorable policy environment for crypto.

FTX Bankruptcy Payouts to Inject Liquidity Into Crypto

Finally, anticipated payouts from FTX’s bankruptcy are expected to inject significant liquidity into the crypto market. Lunde and Zimmerman estimate that around $2.5 billion will be re-entered into the market by creditors in late Q4 or early Q1.

On Tuesday, a reorganization plan for the bankrupt crypto exchange gained 94% creditor support for FTX.com, representing $6.83 billion in claims. A court hearing for confirmation of the plan is scheduled for October 7.

As these assets are liquidated, analysts expect a significant repurchasing of cryptocurrencies, which could give Bitcoin a much-needed boost.

A Promising Outlook for Bitcoin

Despite geopolitical tensions and market volatility, Bitcoin appears to be positioned for a potential rally as the year closes. Key factors, including China’s stimulus measures, U.S. employment data, the upcoming presidential election, and FTX’s bankruptcy payouts, are all set to play a role in shaping Bitcoin’s path forward.

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