💸Quantile model analyst predicts $135K–$285K Bitcoin price in 2025

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Let's see what we’ll discuss today:

• 📈 U.S. deficit tops $1.8 trillion in 2024

• 🔥 Quantile model analyst predicts $135K–$285K Bitcoin price in 2025

• 📊 Dow, Nasdaq, S&P 500 slide

• 🏠 China boosts funds for housing projects

• 👤 Special guest

Estimated reading time: 5 minutes

U.S. deficit tops $1.8 trillion in 2024

The U.S. budget deficit for fiscal 2024 hit over $1.8 trillion, up 8% from last year, driven by record spending of $6.75 trillion despite $4.9 trillion in revenue.

Rising interest costs on government debt, which topped $1 trillion for the first time, contributed significantly. Total debt has grown to $35.7 trillion.

Higher interest rates from the Federal Reserve's inflation fight have worsened the deficit. The deficit now exceeds 6% of GDP, well above the historical average.

The Congressional Budget Office projects continued increases, with deficits reaching $2.8 trillion by 2034 and debt climbing to 122% of GDP.

Chinese Banks Slash Lending Rates

Chinese banks have cut their benchmark lending rates to boost economic growth and stabilize the housing market, following central bank easing in late September. The one-year loan prime rate (LPR) was reduced to 3.10% from 3.35%, and the five-year LPR to 3.60% from 3.85%.

These cuts exceeded expectations and align with the People’s Bank of China's (PBOC) push for more aggressive monetary easing.

While the PBOC signaled further easing, like additional reserve requirement ratio cuts, further rate reductions are anticipated next year unless significant economic shocks occur. The lower rates aim to support mortgages and long-term loans, helping to stabilize the housing market and overall economy.

$556M in spot Bitcoin ETF inflows

On October 14, U.S. spot Bitcoin ETFs saw their largest single-day inflows in over 120 days, with more than half a billion dollars pouring in, driving Bitcoin’s price to $67,800, its highest in over three months.

Key ETFs, including Fidelity Wise Origin Bitcoin Fund and BlackRock’s iShares Bitcoin Trust, led the surge.

Experts attribute the inflows to a combination of factors, including optimism surrounding the upcoming U.S. election, easing recession fears, and growing institutional adoption.

Nearly 47% of traditional hedge funds now have exposure to digital assets, up from previous years. Institutional investors are increasingly driving demand, though retail investors still hold the majority of Bitcoin ETFs.

‘Quantile model’ analyst predicts $135K–$285K Bitcoin price in 2025

Bitcoin recently experienced a strong 9.84% weekly return, breaking above a descending trendline that had been in place since March 2024. Sina, co-founder of 21st Capital, used a quantile regression model to predict Bitcoin’s price ranges for 2025, dividing them into three zones: cold, warm, and hot.

• Cold zone (below 33% percentile): $55,000 - $85,000, where Bitcoin currently falls. This is seen as a buying opportunity for long-term investors.

• Warm zone (33% to 66% percentile): $85,000 - $136,000, where retail investors are expected to enter as BTC sets new all-time highs.

• Hot zone (66% to 99% percentile): $136,000 - $285,000, where Bitcoin could peak, with high volatility expected due to profit-taking and leveraged positions.

Sina highlighted that Bitcoin tends to spend about a third of its time in each of these zones before transitioning to the next.

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Dow, Nasdaq, S&P 500 slide as Treasury yields hit highest level since July

U.S. stocks declined on Tuesday as investors reacted to a recent bond-market selloff and prepared for upcoming earnings reports. The S&P 500 dropped over 0.5%, the Dow Jones fell by 120 points (0.3%), and the Nasdaq slid 0.6%.

Concerns about whether the Federal Reserve will continue cutting rates amid a strong economy and cautious commentary contributed to market pressure.

The 10-year Treasury yield stabilized around 4.2%, following sharp gains on Monday. Rising yields impacted rate-sensitive sectors like real estate, leading to stock declines.

China boosts funds for housing projects

China is expanding its "white list" of housing projects eligible for financing, increasing bank lending to 4 trillion yuan ($562 billion) by year-end, in an effort to stabilize its troubled real estate sector. This follows a series of measures aimed at supporting developers and restoring confidence in the market, which has struggled since the 2021 crisis.

These initiatives aim to absorb housing inventories and complete unfinished projects. So far, 2.46 million homes have been delivered since May, and loans for the white-listed projects reached 2.23 trillion yuan as of October.

Despite these efforts, China's real estate market saw a muted response, with the CSI300 real estate index dropping 5%.

Stop ignoring the crypto market as a way for long-term investing - Blidaru Mihnea

We all know that if we invest in the SXP500 we can have an 8% return because history proved it although crypto as a volatile market flies under the radar for long time investing.

For example:

Here is a chart for a 100$ weekly investment in Bitcoin for the past 2 years.

What I’ve noticed is the returns we have if we invest in the biggest crypto out there the same way as we would’ve invested in the SXP500.

Currently, it sits at a wooping 101% gain percentage in just 2 years.

Imagine what would happen if we extrapolate this into 10 years.

Why would someone invest in something with an 8% return when you have right in front of you a possible 50% yearly? I tell you why. Fear and risk.

Crypto is volatile, however, history shows us that it always recovers, and with this idea in mind, you can buy and hold Bitcoin for a long period, buying weekly and waiting for the market to recover even if is slowly bleeding.

Basically, when it bleeds, you buy more Bitcoin. It’s perfect.

It is still time for long-term investing in crypto. The market is still young and we still have the opportunity to invest for our children or family. Things will probably change in the next 12-15 years, but until then, there is no single excuse not to try it.

You can find Mihnea on Twitter/X here: https://x.com/blmihnea

Investing Meme 😂

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.