QCP stated in its daily report published today that macroeconomic conditions for cryptocurrencies and other risky assets continue to improve.
QCP: Easing Steps by Chinese and Global Central Banks Could Support Crypto Market
The report noted that the People's Bank of China has launched a series of stimulus policies for the stagnant property market and stock market.
Among these policies, the 500 billion yuan swap facility announced to facilitate the purchase of shares by non-bank financial institutions stands out. These developments caused China's A50 futures contracts to close with an 8% increase.
QCP expects the People's Bank of China to continue its easing policies, while it believes the US Federal Reserve will also join the global rate cutting cycle.
It is reported that major central banks, with the exception of the Bank of Japan, are preparing to inject more liquidity. These steps create a supportive environment for risky assets in global markets.
The report also noted that the spread between the US 2-year and 10-year Treasury yields widened to 21 basis points, indicating positive expectations for economic growth. Such widenings generally have positive consequences for risk assets in the medium to long term.
It is emphasized that political discourses on artificial intelligence and digital assets in the USA have also increased the interest in risky assets.
After US Vice President Kamala Harris made aggressive statements about AI and digital assets at fundraising events, AI-related tokens have seen a recovery.
Additionally, the SEC’s approval of IBIT Bitcoin ETF options trading points to the growing acceptance and demand for digital assets.
The QCP report notes that specific factors driving cryptocurrencies higher are currently lacking, but improving macroeconomic conditions could push cryptocurrency prices higher in the long term.
“We know how explosive crypto prices can be. The next wave of bullish moves could catch many investors off guard and miss opportunities,” the report said.
These developments show that digital assets may be supported by macroeconomic factors in the coming periods and a new wave of earnings may occur.
*This is not investment advice.