Analyst highlights three liquidity factors influencing the BTC price

Ki Young Ju, the founder and chief executive officer of CryptoQuant, has highlighted that there are a total of three liquidity factors that are affecting the price of Bitcoin ($BTC). These are stablecoins, fiat currencies, and spot ETFs. BTC is currently down to around $61,000, and there are rising concerns that it could dip lower before marking an uptick. Such concerns have forced the community to anticipate the factors that are causing the decline.

To begin with, stablecoins are garnering significant attention from the market, as evidenced by their increasing market capitalization. Stablecoins’ market cap has grown to be closer to ATH than BTC’s market cap. According to Young, the increase in stablecoins’ market cap suggests their use in buy-side liquidity, potentially leading to further price movements.

The trend aligns with a rising interest in altcoins—cryptos other than Bitcoin. It has sent signals across the market that the demand for Bitcoin may decline in the times to come. Experts speculate that the altcoin season will soon commence. It could be activated with the Spot Ether ETF’s approval. An actual trigger point and the reason behind it remain to be seen.

Spot ETFs have been negative for two weeks. A resurgence is expected to eventually make a breakthrough, subject to the political risks associated with it. Spot Ether ETF serves as a perfect example here, as its final approval hangs in the balance. 

Community members believe that the Biden administration could potentially make progress, given Donald Trump’s intention to do so if elected. Crypto enthusiasts form a significant portion of the voter base, and hence, it becomes imperative to consider their demands for applications.

That automatically transitions the content to the next liquidity factor: political influence.

Donald Trump had earlier said that he was more than willing to accept cryptocurrencies as donations for his campaign. He had made this statement while entertaining the holders of his NFTs and responding to their inquiries.

Bitcoin continues to decline, moving away from the ATH of $73,000. A drop to $60,000 could open the door for a larger number of bears. Bitcoin projections estimate the token to end 2024 on a higher note, probably around $100,582. Analysts have said that BTC can even achieve the milestone of $150,000 by year-end.


Undoubtedly, numerous factors influence the value of Bitcoin. The Federal Reserve’s decision to cut rates is a significant factor, as it impacts the supply of liquidity. Investors are less willing to consider riskier assets when rates are higher. Additionally, Mt. Gox has announced its plans to distribute tokens to the 2014 hack victims. It could put selling pressure on the ecosystem.

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