Coinbase Institutional Predicts Turbulent Third Quarter, Points to Absence of Compelling Narratives in Cryptocurrency Sector
Coinbase Institutional, the specialist division of the American digital currency trading venue Coinbase, is alerting crypto investors to anticipate further unification this period.
Coinbase Institutional’s recent analysis points to signs of caution among crypto participants, mindful of the potential for a downturn in the U.S. economy.
Despite this, Coinbase notes potential optimistic triggers could emerge provided economic conditions remain resilient.
“Job cuts might not spark market enthusiasm if they’re seen as an omen of a more extensive economic contraction. In such a scenario, it’s likely that retail investors would hesitate to embark on fresh ventures in stock or cryptocurrency markets amid a recession in the U.S.
Conversely, a reasonably solid economic status coupled with federal rate reductions could drive liquidity, encouraging further retail involvement. Additionally, we’re approaching the U.S. elections in November, which could herald fiscal stimulus irrespective of the victor. This prospect strengthens the case for Bitcoin as an alternative to the conventional financial system, in our opinion.”
The response from traders to newly authorized Ethereum (ETH) exchange-traded funds (ETFs) remains uncertain in the short term, observes Coinbase. However, the firm believes the introduction of Ethereum ETFs is fundamentally positive for the altcoin’s long-term trajectory.
Moreover, Coinbase anticipates a time of volatile price fluctuations for cryptocurrencies in the next few months preceding the emergence of a definitive trend.
“Presently, we envisage a turbulent market throughout Q3 2024, as crypto markets are currently devoid of compelling narratives. The impact of anticipated ETH ETF inflows—which experts predict will happen soon—on the market is yet to be established as clearly positive or negative. However, this ambiguity might not necessarily be detrimental for positioning.
The potential for unexpected market success exists, possibly propping up ETH even if the anticipated inflows are slow to come into effect. Nevertheless, we predict it will be a couple more months before we observe an upswing in market stability, expectedly around late September.”
Ethereum holds a value of $3,205 as of this report, showing a 2% gain since the previous day.
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