What Does Bitcoin's Future Price Movement Depend On? Analysts Single Out These Key Catalysts

Bitcoin‘s (CRYPTO: BTC) future price movement is likely to be influenced by four key catalysts, according to analysts.

What Happened: The cryptocurrency’s price has surged by over 50% this year, driven by the approval of the January spot ETF and the recent halving event.

However, with these two events now in the past, investors are looking for new factors that could propel Bitcoin’s price higher. Analysts have identified four potential catalysts:

Interest rates: Bitcoin’s price has historically risen when borrowing costs are low. Investors are now closely watching the Federal Reserve’s stance on rate cuts.

“In the first quarter, we had the halving coming in, but mostly we had this huge adoption of the ETFs. So as that gets priced in, now you’re looking for what the Fed can do,” Galaxy CEO Mike Novogratz told Bloomberg. He said that until short-term interest rates decline, Bitcoin will likely remain within a range of $55,000 to $73,000.

Regulatory clarity: The legal sentiment around crypto seems to be adjusting. One future bitcoin catalyst could be the looming stablecoin bill, Oppenheimer executive director Owen Lau told CNBC in early May. It could come as soon as this year.

In the meantime, the U.S. House of Representatives has passed a comprehensive regulatory framework for the crypto industry, celebrated as a significant victory for the sector. Although its future in the Senate remains uncertain, this legislation would provide clearer rules for the cryptosphere, according to a report by Business Insider.

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Presidential election: A clear regulatory framework for Bitcoin is expected to emerge after the presidential election. A victory for Republican candidate Donald Trump is seen as a positive for Bitcoin.

Standard Chartered‘s Geoff Kendrick mentioned in a note from May that a Trump victory would have a broadly positive impact on Bitcoin. He further noted that growing concerns about the U.S. deficit and debt trends are likely to drive up Bitcoin, as investors seek alternative investment options.

Kendrick highlighted that this trend could occur regardless of the candidate’s victory, as neither has presented a clear plan to address government spending issues.

Bitcoin’s evolution: As perspectives on bitcoin evolve, the cryptocurrency itself is undergoing a transformation. Bloomberg reports that developers have been actively enhancing the functionality of the bitcoin network. These initiatives aim to elevate the crypto beyond its role as a speculative asset and, with projects rapidly emerging, could provide a new catalyst.

One notable example is the recently launched Ordinals protocol, which enables users to store assets other than bitcoin on the BTC blockchain and even trade items like nonfungible tokens. Bitget Managing Director Gracy Chen noted on X that the Ordinals market has already reached a daily trading volume of $3.42 million in mid-May.

Why It Matters: The potential for Bitcoin’s price to surge is supported by recent market trends. On Memorial Day, Bitcoin, Ethereum, and Dogecoin edged higher, with one analyst describing the climb as “encouraging.” Additionally, Bitcoin recently smashed the $70,000 mark, prompting a trader to predict new all-time highs.

Price Action: Bitcoin is currently trading at $68,018 over the past 24 hours, marking a 1.95% decrease. However, the coin has seen a remarkable 53.98% increase year to date, according to the data from Benzinga Pro.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote