Bitcoin is poised to potentially reach a new all-time high by November, driven by a combination of the Federal Reserve’s anticipated interest rate cuts and the uncertainty surrounding the U.S. presidential election, according to Shubh Varma, co-founder and chief executive at Hyblock Capital, a crypto research platform. In a recent interview, Varma discussed the Federal Reserve’s likely move to initiate its first rate cut in years this September, a development that could significantly influence financial markets.
This year, the open interest in bitcoin futures—reflecting the total number of active contracts—has been notably higher than last year, signaling increased market activity. However, Varma noted that while open interest has been rising, it hasn’t yet reached the levels required to trigger a strong upward movement in bitcoin’s price. For bitcoin to make a significant directional move, a more substantial increase in open interest is essential, according to Varma.
The market is already factoring in the Federal Reserve’s first rate cut in four years, which is expected in September. Combined with the volatility anticipated around the upcoming U.S. presidential election, this setup could create a bullish environment for cryptocurrencies. If the Federal Reserve’s shift towards rate cuts acts as a catalyst for riskier assets, bitcoin could see considerable gains.
Varma further explained that if bitcoin approaches or surpasses its previous peak of around $73,700, it could act as “free advertising” for retail investors. This renewed interest could drive open interest even higher, increasing market volatility and potentially leading to another surge in bitcoin’s value.