Cryptocurrency service provider Matrixport’s analyst Markus Thielen stated that after Binance reached a settlement with the US Department of Justice, the price of Bitcoin may surpass $40,000 this year. He also mentioned other bullish catalysts, including the increase in USDT stablecoin market value, growing institutional interest, and favorable macro environment.
Thielen, the head of research at Matrixport, in a report released on Thursday, expressed that following Binance’s settlement with the US DOJ and its CEO Zhao Changpeng pleading guilty to financial misconduct, Bitcoin’s price could potentially exceed $40,000 this year, marking a turning point in the cryptocurrency landscape.
Thielen believes that the outcomes of the investigation on Binance do not pose as serious market concerns as a $10 billion fine would have, and the exchange was not accused of misappropriating user funds or market manipulation, indicating that Binance could still maintain its position among the top three exchanges in the next 2 to 3 years.
Thielen stated that despite initially being viewed as a risk-avoidance event by the market, Bitcoin only experienced a brief correction and rebounded from the $36,000 level in a “strong counter-trend response,” making it “inevitable for Bitcoin to rise above $40,000.”
Regarding Bitcoin’s seasonality, the Matrixport analyst mentioned that Bitcoin’s price rose by 28% in October this year, with expectations of the approval of a US Bitcoin spot ETF, which could further demonstrate people’s confidence in Bitcoin as a legitimate asset class.
Thielen added that seasonality is another factor, with Bitcoin historically showing an average return rate of 12% in December, providing a chance for Bitcoin’s price to rise to $42,000 based solely on this indicator.
Thielen also noted that since September, the market capitalization of Tether’s USDT stablecoin has increased by $5 billion, indicating a growing trend of institutional investors converting fiat currency into stablecoins, which could potentially be exchanged for other cryptocurrencies like Bitcoin.
Furthermore, Thielen mentioned that the macro environment continues to be favorable for the cryptocurrency market. Matrixport predicts that the inflation rate will halve again to 1.6%, following the peak of the US 10-year bond yield reaching 4.95% in this cycle, with bond yields expected to decrease to 2.60% in 2024 or 2025.
The analyst added that the adjustment in bond yields is anticipated to lead to a rise in the stock market, which often correlates with the performance of cryptocurrencies.