Tide Capital: BTC’s major uptrend may have quietly begun

Recently, as the macroeconomic environment has stabilized, the proportion of cryptocurrency among institutional investors is increasing. BTC is starting to outperform US stocks and gold, indicating that a new major uptrend may be underway. Altcoin season hasn’t arrived yet, but the meme sector deserves some attention.

Stable macroeconomic environment, risky assets continue to increase

Since entering the fourth quarter, the U.S. economy has shown strong performance and resilience, with inflation effectively controlled. The market generally expects a “soft landing” to be the default scenario. Thanks to fiscal and monetary policies, the U.S. stock market reached record highs and benefited from an overall increase in risk assets.

Source: TradingView

However, the United States significantly increased debt to stimulate the economy, which led to a sharp increase in debt, triggering a crisis of investor confidence in the dollar. To hedge against the potential risk of a dollar credit collapse, investors are turning to gold, which is in limited supply and gold prices continue to reach historic highs.

Source: TradingView

At the same time, Bitcoin, known as ‘digital gold’, has once again surpassed $70,000 and is close to its historic peak. Unlike six months ago, Bitcoin has undergone significant consolidation, absorbing selling pressure from previous surges and making its chip structure healthier.

Source: TradingView

Overall, the recent macroeconomic environment appears stable. Risky assets are benefiting from the dual support of US fiscal and monetary policies and are currently on the rise. In the future, the Federal Reserve is expected to further reduce interest rates and complete quantitative tightening (QT) next year. Liquidity will become more accommodating, which will help sustain the growth of risky assets.

BTC begins to outperform US stocks and gold, a major uptrend may have begun

As Bitcoin’s market capitalization continued to increase, its correlation with the U.S. stock market gradually strengthened. Global liquidity typically flows into U.S. stocks first before flowing into cryptocurrency markets. As a result, Bitcoin may at times outperform or lag U.S. stocks, reflecting changes in investor risk appetite.

In particular, Bitcoin has recently significantly outperformed the Nasdaq index, with BTC/IXIC breaking out of its downward trend and stabilizing above its 120-day moving average. This indicates that institutional investors are gradually shifting the focus of their asset allocation to Bitcoin.

Source: TradingView

Moreover, Bitcoin’s shadow stock, MSTR, recently surpassed Bitcoin itself to hit historic highs. MSTR’s business model involves issuing bonds to purchase Bitcoin, effectively creating a leverage vehicle for Bitcoin. MSTR’s continued rise reflects institutional investors’ strong confidence in Bitcoin’s future performance.

Source: TradingView

Additionally, the Bitcoin ETF has seen significant inflows for several days in a row, reminiscent of the significant rally in BTC since its launch. Net inflows into Bitcoin ETFs on October 30 reached $900 million, the second-highest daily total in history.

Source: CoinMarketCap

Additionally, BTC futures open interest increased significantly, hitting a new high of $12.7 billion, according to CME data reflecting U.S. institutional trading activity.

Source: Coinglass

These data points indicate a significant increase in institutional interest in Bitcoin, accelerating the rate at which OTC funds are flowing into Bitcoin. BTC is starting to outperform other major asset classes and a new major upward trend may have quietly begun.

Altcoin season hasn’t arrived yet, but the Meme sector is worth keeping an eye on.

Even though Bitcoin is approaching its historical peak, the overall performance of altcoins remains lackluster. The total market capitalization of cryptocurrencies (TOTAL2) excluding BTC remains at a relatively low level and is unable to break the September high, suggesting weak upward sentiment in the altcoin market.

Source: TradingView

This indicates that new market inflows are mainly directed towards Bitcoin, with little or no capital flowing into other cryptocurrencies. Bitcoin (BTC.D) dominance recently reached a new high, surpassing 60%. Until Bitcoin breaks its historic peak, bullish sentiment will continue to focus on Bitcoin, making it difficult for altcoins to attract significant inflows and the overall downward trend could continue.

Source: TradingView

However, there are notable exceptions in the field of memes. Among the top 100 tokens by market capitalization, 6 of the 10 highest-grossing tokens over the past 30 days are meme coins.

Source: CoinMarketCap

Among the top 500 tokens by market capitalization, almost all of the best performing tokens are meme coins. In an environment where overall funds are tight, small cap meme coins can capture almost all the attention and liquidity of the altcoin market and achieve higher returns in a shorter period of time.

Source: CoinMarketCap

At the same time, Solana is increasingly becoming a major trading network for meme tokens. The low costs and high TPS performance make it a great fit for retail traders engaging in meme trading, and the popularity of the meme sector has brought many new users to Solana. In October, Solana’s active addresses surpassed 100 million, a new all-time high.

Source: The Block

The emergence of new token issuance and trading platforms is also accelerating the adoption of meme coins. For example, Pump.fun launched on the Solana network this year, providing users with convenient Meme token issuance and early trading services. At one point, trading volume accounted for more than half of Solana network activity. In October, Pump.fun set new records for both token distribution and revenue, with daily revenue exceeding $1 million.

Source: Sand Analysis

Another popular trading platform for meme tokens is Moonshot, which is praised for its easy deposit process and simple operations. Moonshot combines the functionality of a wallet and an exchange, significantly lowering the barrier to entry for users. The platform has a streamlined registration process that eliminates the need for users to manage private keys or mnemonic phrases, and supports fiat deposits through a variety of payment methods, including credit cards, PayPal, and Apple Pay. Moonshot has demonstrated a notable “listing effect,” with well-known meme coins such as $GOAT, $MOODENG, and $SPX experiencing multiple returns post-listing.

Source: Moonshot website

Overall, the influence of the meme sector in the cryptocurrency market continues to grow. Despite the lack of inherent utility of meme tokens, the underlying infrastructure, including blockchain networks, trading platforms, and payment tools, continues to evolve positively, lowering barriers and improving user experience. As the macro environment becomes more accommodating and investors’ risk appetite increases, the meme sector could see even more impressive performance.

Institutional investors are increasing their allocations to cryptocurrencies, and a new major upward trend for BTC may have quietly begun.

disclaimer

The information in this article comes from public sources and Tide Capital does not guarantee its accuracy or completeness. Opinions and predictions are speculative and may differ from actual results due to data limitations and unforeseen risks. This article does not provide investment advice, recommendations, or recommendations to buy or sell digital assets. Tide Capital is not responsible for any misuse or misunderstanding of this content.