As of the most recent update on October 9, 2024, Bitcoin’s potential for a bullish fourth quarter remains strong, despite recent market volatility stemming from escalating tensions in the Middle East and robust U.S. employment data. Analysts from K33 have highlighted the resilience of the leading cryptocurrency, citing positive signals from the FTX estate’s creditor repayment process that could bolster market sentiment. Following initial pressure on Bitcoin due to geopolitical unrest, a rebound occurred over the weekend, supported by better-than-expected U.S. jobs data. Analysts expect Bitcoin to continue its strong performance as the year comes to a close.
A significant development influencing market sentiment is the progress in the FTX bankruptcy proceedings. Two years after the collapse of the crypto exchange, a reorganization plan was approved by Judge John Dorsey of the U.S. Bankruptcy Court for the District of Delaware. With around 94% of creditors supporting the proposal, creditor repayments are expected to begin late in Q4 and extend into early 2025. The analysts project that debtors with claims under $50,000 could receive payouts within a 60-day period following the court’s effective date, anticipated for mid-November.
Sell-side pressure in the market has already been alleviated to some extent, as many crypto assets from the FTX estate have been converted into fiat currency. Credit funds have acquired a significant portion of the total claims, which could influence the flow of capital back into the cryptocurrency market in Q4. Analysts estimate that approximately $2.4 billion out of the remaining $8 billion could potentially return to crypto markets, but this influx is expected to be gradual, reducing its immediate impact on market dynamics.
According to K33’s analysis, only 21 of the top 100 cryptocurrencies have outperformed Bitcoin in 2024, with most being memecoins, less liquid tokens, or new Layer 1 projects. While nearly half of the top 100 cryptocurrencies have seen negative returns, some, such as ETH, SOL, AAVE, DOGE, and TRX, have posted gains but still underperformed Bitcoin. The analysts also note that sell-offs related to geopolitical risks often present buying opportunities, and recent market turbulence could lead to tactical entry points for investors.
Despite recent challenges, Bitcoin’s outlook for a strong finish in the fourth quarter remains optimistic. Positive developments, including the progress in the FTX bankruptcy proceedings and better-than-expected U.S. employment data, have contributed to market rebound and increased sentiment. While geopolitical tensions have eased and macroeconomic factors like the U.S. employment report have influenced market dynamics, sentiment remains neutral according to ETC Group. Market participants continue to monitor liquidity shifts and macroeconomic developments closely as Bitcoin prepares for the final quarter of 2024.
