Bitcoin has recently surged to $96,580, a 5.8% increase within 24 hours, following reports of a potential pro-crypto executive order from President-elect Donald Trump.
Analysts predict that Bitcoin could see substantial price increases as it enters the final year of its four-year cycle, with capital inflows potentially reaching $520 billion in 2025. The Market Value to Realized Value (MVRV) ratio of Bitcoin is currently 2.3, indicating room for growth. However, risks such as a possible "sell-the-news" event and weak retail participation could temper momentum.
The upcoming Consumer Price Index (CPI) data release is expected to impact market sentiment. If inflation remains low or stabilizes, the Federal Reserve may ease its interest rate stance, creating a favorable environment for Bitcoin. Conversely, high inflation could delay monetary easing and hinder Bitcoin's upward trajectory.
Some analysts maintain a bullish outlook for Bitcoin in the long term, supported by favorable macroeconomic trends and institutional adoption. The interplay between inflation data, Federal Reserve policies, and market sentiment will be critical in determining Bitcoin's trajectory. The approach of the new administration to cryptocurrency regulation and support could also shape investor confidence and capital flows into the market.