Dispatch #223: Bitcoin: The new peaks ahead

In this patch of your weekly Dispatch:

• The path to BTC reserves
• XRP’s momentum explained
• Interest rate decisions

Market cast

$110,000 next up for BTC?

Bitcoin appears poised for a new all-time high (ATH) as technical indicators signal strong momentum and heightened optimism. Long-term oscillators are in overbought territory, exceeding the 70 level, reflecting the bullish sentiment driving the market.

Additionally, Bitcoin's price is trading above the upper Bollinger Band across most timeframes, reinforcing the strength of the ongoing trend. However, at these elevated levels, a correction in the prevailing trend could be on the horizon—a natural course of action in the short term, with Bitcoin supply in profit sitting at a stratospheric 97%.

Looking ahead, the next potential target could be the $110,000 mark, a key Fibonacci level. On the downside, the $100,000 level now serves as a solid support, having previously been a strong resistance point. As the market unfolds, these levels will likely serve as critical reference points for traders.

The big idea

Bitcoin’s reserve appeal

Bitcoin is fast becoming a serious contender for a reserve asset, with Japan jumping on the bandwagon. Recently, none other than Japanese lawmaker Satoshi Hamada proposed the idea of a national Bitcoin reserve, and he’s not alone. From Russia to Brazil, lawmakers are starting to see Bitcoin as a hedge against inflation and currency debasement, especially as its value continues to climb. Even the U.S. has caught on, with talks of building a Bitcoin strategic reserve making waves.

But there’s been one major issue holding Bitcoin back and that’s its proper valuation. Enter the Financial Accounting Standards Board (FASB), which just dropped a game-changing rule. From now on, Bitcoin and other digital assets will be measured at fair value, reflecting their real-time market price. This new accounting standard clears up the confusion and opens the door for more institutional adoption. With clearer reporting and a more accurate picture of Bitcoin’s worth, its volatility could be better managed. So, is Bitcoin "up only" from here? Time will tell.

Ethereum

Bigger things ahead for ETH? 

ETH is currently around $4000, but we are seeing bigger things ahead and some of the leading analysts agree. Ethereum’s price could surpass $5,000 if current supply-and-demand trends continue, driven by rising on-chain activity and investor interest, according to CryptoQuant analysts. Key factors include deflationary dynamics from increased fee burns and a significant surge in network activity, with daily transactions reaching up to 7.5 million. Institutional interest is also rising, with BlackRock and Fidelity purchasing $500 million worth of Ether in just two days. U.S.-listed spot Ethereum ETFs accumulated $1.95 billion in 13 days, signaling strong confidence in Ethereum as an investment vehicle.

Solana

Solana hunts for talent

While ETH battles the charts, its old rival Solana is far from asleep. The network has emerged as the top blockchain for new developers, according to a recent report, with 7,625 developers joining it this year, marking an 83% increase year-over-year. This growth surpasses Ethereum's, the first time since 2016 that another blockchain has outpaced Ethereum in developer growth. Despite Solana's rapid rise, Ethereum still leads globally in total developer share. The surge in Solana’s developer activity is attributed to factors like a spike in network and user engagement, fueled by the popularity of memecoins and platforms that simplify their launch.

Hot in crypto

XRP rides the waves

XRP continues to hold its ground and then some as its price surges above $2.60 early Tuesday, following a dramatic spike in open interest to almost $4 billion, as analyzed by Dispatch editors in the media. This surge has many market participants signaling a bullish outlook for XRP, with some predicting continued upward momentum. The timing of XRP’s price rise coincides with a significant development for Ripple: the launch of its U.S. dollar-pegged stablecoin, RLUSD.

Adoption

(Almost) everybody in on crypto

A global survey by Consensys and YouGov reveals growing crypto adoption and understanding, with 93% of respondents aware of cryptocurrencies. Over half of those surveyed claim to understand the technology, and 42% own or have invested in digital assets. Ownership is highest in Nigeria (73%), South Africa (68%), and the Philippines (54%). While adoption is growing in Europe, concerns about market volatility and scams still hinder wider participation. The survey also highlights a rising demand for privacy and dissatisfaction with traditional financial systems, especially in regions like Nigeria and Indonesia.

Macroeconomic roundup

Decision times across the globe

This week’s global economic calendar is packed, with three major central banks—the Federal Reserve (Fed), Bank of England (BoE), and Bank of Japan (BoJ)—set to make interest rate decisions. For the U.S., all eyes are on the Fed, where a 0.25% rate cut is widely anticipated, following mixed signals from last week’s inflation data. However, a hawkish tone from policymakers could temper market optimism.

Retail sales data for August will also play a pivotal role in shaping sentiment, as it provides a pulse check on U.S. consumer spending.

The week’s most interesting data story

Cheers to the next $200 billion

This week’s chart highlights a historic milestone in the crypto world: the stablecoin market has surpassed a $200 billion total market cap for the first time. Adding $10 billion in just two weeks, stablecoins like Tether (USDT) and Circle's USDC are driving this growth, fueled by surging demand for liquidity in crypto trading and increasing adoption for payments and remittances. As stablecoins expand their role in global finance, projections suggest the market could double to $400 billion in 2025, making this asset class a cornerstone of the digital economy.

The numbers

Top 5 stats of the week

93% – Odds of a 25bps rate cut by the Fed next week after recent inflation data.

$20.3 billion – Crypto investment product inflows over the past 10 weeks, 45% of 2024’s total.

15,350 BTC – MicroStrategy’s latest Bitcoin purchase for ~$1.5 billion.

$120 billion – Bitcoin futures trading volume hit an all-time high on Nov. 17.

$107,882 – Bitcoin’s new all-time high recorded on Monday.

Hot topics

What the community is discussing

Stablecoin history meets banking history.

Charts for the Solana fans.

One day left.

Dispatch is a weekly publication by Nexo, designed to help you navigate and take action in the evolving world of digital assets. To share your Dispatch suggestions and comments, email us at [email protected].