TechFlow news, on December 27, Matrixport's weekly report indicated multiple potential threats that could disrupt the current Bitcoin bull market. One notable concern stems from BlackRock, which stated that due to Bitcoin protocol’s decentralized nature, there is "no guarantee" the 21 million supply cap will remain unchanged. Additionally, new developments such as Google's announcement of its 105-qubit quantum chip named "Willow" have sparked discussions about potential long-term threats to Bitcoin's security.
Federal Reserve officials have recently raised their inflation expectations. This shift appears driven more by political considerations. Specifically, concerns over Trump potentially imposing additional tariffs—widely viewed by economists as inflationary—seem to have influenced their outlook. However, during Trump’s first term, these tariffs had minimal impact on inflation. This suggests that the Fed’s current inflation expectations may not fully align with economic reality, potentially creating room for policy flexibility in the coming year.
According to Matrixport’s model, inflation is unlikely to become a significant issue next year, which could allow the Fed to maintain a dovish stance. However, historically, Bitcoin bull markets tend to peak when regulatory pressures reach a critical point. With many previously unresolved regulatory issues seemingly addressed, the risks ending this Bitcoin rally may now depend on other factors.
While the abandonment of near-zero interest rates in December 2021 marked a major shift, more recently, the Fed had signaled intentions to cut rates for over a year before finally implementing the first rate cut in September 2024. This situation introduces new uncertainties for Bitcoin and the broader crypto market, as the Fed’s response to potential fiscal policies under a Trump administration could influence the trajectory of monetary policy.
