Bitcoin Flash Crash

Nakamoto 2025-9-17 18:17 26253人围观 BTC

Last week, the U.S. stock market adjusted across the board, with the Dow Jones Industrial Average falling 0.02% for the week, the Nasdaq Index falling 0.70% for the week, and the S&P 500 Index falling 0.13% for the week. In fact, since March, the over

Last week, the U.S. stock market adjusted across the board, with the Dow Jones Industrial Average falling 0.02% for the week, the Nasdaq Composite Index falling 0.70% for the week, and the S&P 500 Index falling 0.13% for the week. In fact, since March, the overall performance of U.S. stocks has been poor. Fluctuations in interest rate cut expectations triggered by economic data and the weak performance of star technology stocks have dampened investor confidence and upward momentum.

Looking ahead to this week, the U.S. stock market will face multiple tests. The Federal Reserve and the Bank of Japan lead the Super Central Bank Week, and nearly 10 central banks will release interest rate decisions one after another. The Federal Reserve's latest decision may cause the market to reprice the path of interest rates, further affecting risk appetite.

In addition, NVIDIA will hold its annual AI conference GTC this week. As one of NVIDIA's most important release platforms every year, GTC has become a recognized "AI weathervane." Whether NVIDIA can once again ignite market confidence with GTC will also become a major focus.

It is also worth noting that over the past weekend, the virtual currency market suddenly crashed. The price of Bitcoin once fell below US$65,000 per coin, with the largest intraday drop exceeding 6%. Some market views believe that the price of Bitcoin has recently reached a new high, the short-term market is overheated, and the leverage ratio has increased significantly. If some funds take profits and the market falls, it may bring greater price fluctuations and market risks in the short term.

Week ahead: The Federal Reserve’s interest rate decision is coming

Looking ahead to this week, the Federal Reserve will usher in its second interest rate meeting this year on Thursday. Investors are paying close attention to the Federal Reserve's interest rate decision, the latest interest rate dot plot and the press conference that Powell will hold. At present, the market generally expects that interest rates will remain unchanged, maintaining the benchmark rate at 5.25%-5.5%, but the outside world will carefully scrutinize any comments suggesting when to start cutting interest rates.

From a market perspective, there are three major focuses worthy of attention at this Federal Reserve interest rate meeting: Have expectations for interest rate cuts changed? Has the inflation outlook changed? When and How Will the Fed Slow Quantitative Tightening (QT)? In addition, the market will also pay attention to the interest rate cut route in 2025.

Federal funds rate futures show investors are now fully pricing in a rate cut in July, with the likelihood of action in June cooling down. A series of previously released macroeconomic data show that U.S. inflation will not disappear soon, and inflationary pressure is stronger than expected.

Fed officials' median forecast in December 2023 showed that three 0.25% interest rate cuts were expected in 2024. Strategists at Bank of America warned that it would only take two officials to switch to two rate cuts to spur another rise in Treasury yields. Goldman Sachs lowered its expectations for the number of interest rate cuts by the Federal Reserve in 2024 in the FOMC outlook report released over the weekend.

Goldman Sachs said that U.S. inflation has increased in recent months, but is still expected to fall to a level sufficient for the first interest rate cut by the FOMC meeting in June. However, this has become less obvious, and the path of inflation for the rest of the year is now within the range where a small surprise can have big consequences. Goldman Sachs now expects the Fed to cut interest rates three times in 2024 (up from four), mainly because of a slightly higher inflation path. The agency still expects the Fed to cut interest rates four times in 2025, with the final rate cut expected in 2026.

Is the Bank of Japan looking to end negative interest rates?

In addition to the Fed, one to watch this week is the Bank of Japan. The Bank of Japan will hold a monetary policy meeting from March 18 to 19. Whether the Bank will end the eight-year era of negative interest rates will become the focus.

Data shows that Japan's salary increase will reach 5.28% in 2024, the largest increase in more than 30 years. Significant wage growth is a prerequisite for the Bank of Japan to achieve its long-term price target of 2% and end the negative interest rate policy since 2016. Previously, on March 15, Japan Jiji News Agency suddenly reported that the Bank of Japan was making final arrangements to end the negative interest rate policy. On the evening of March 14, the news agency reported that the Bank of Japan plans to end its negative interest rate policy at its March meeting.

UBS believes in its latest research report that despite the possibility of canceling the negative interest rate policy in March, the Bank of Japan is more likely to choose to release a policy shift signal this month and then formally implement the adjustment in April.

In terms of major events, Nvidia’s annual AI conference GTC (GPU Technology Conference) will be held at the San Jose Convention Center in the United States from March 18th to 21st. In the early morning of March 19th, Beijing time, NVIDIA CEO Jensen Huang will give a keynote speech. According to NVIDIA, Huang Renxun will release the latest breakthrough results in accelerated computing, generative AI and robotics.

As one of NVIDIA's most important release platforms every year, GTC has become a recognized "AI weather vane". This GTC is also the first time it has been held offline in five years. Wall Street expects that this GTC will help Nvidia stock end its recent volatile trend and continue its strong growth of more than 80% so far this year.

Bitcoin flash crash

The virtual currency market once again staged a "roller coaster" market.

On the morning of March 17, Beijing time, the price of Bitcoin once fell below the integer level of 65,000 US dollars, a drop of more than 6%.； The price of Ethereum once fell below US$3,500 per coin, a drop of 9.77%.

In fact, Bitcoin has experienced "big ups and downs" many times recently. For example, on March 14, the price of Bitcoin soared above $73,000, setting new all-time highs for four consecutive days. But on March 15, the price of Bitcoin fell below $66,000 to a one-week low. From a day-to-day perspective alone, Bitcoin price fluctuations are also highly volatile, often reaching thousands of dollars.

Looking back at this round of Bitcoin market, it has lasted for nearly two months. Since the end of January, the price of Bitcoin has increased significantly. From the US$38,000 level on January 23, it successively broke through the US$60,000 and US$67,000 mark, and broke through US$69,000 on the evening of March 5, setting a record high for the first time. On March 14, Bitcoin hit an all-time high, approaching $74,000, a cumulative increase of more than 70% from the beginning of this year. The previous record for Bitcoin price was $68,999.99, set in November 2021.

What are the driving factors for this round of Bitcoin market?

First, the Bitcoin spot ETF was approved for issuance. On January 10, the U.S. Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETF applications and authorized 11 ETFs to begin listing and trading on January 11. Approved spot Bitcoin ETF issuers include Grayscale, iShares, Ark 21Shares, Invesco Galaxy, etc.

The approval of Bitcoin spot ETF has accelerated the inflow of related funds. According to data from Farside Investors, as of March 12, the Bitcoin spot ETF has accumulated a net inflow of US$10.1003 billion since its launch.

The second is catalyzed by the positive effects of Bitcoin’s “halving”. “"Halving" refers to the halving of mining rewards, which occurs approximately every four years, depending on the Bitcoin network's block generation rate. This will reduce the supply of Bitcoin, expected on April 23, 2024, when the block reward will drop from 6.25 BTC to 3.125 BTC.

The Soochow Securities research team believes that the "halving" rule objectively limits the growth rate of Bitcoin supply, has an anti-inflation effect, and helps promote currency price appreciation.

Third, expectations of interest rate cuts by the Federal Reserve have also boosted the Bitcoin market. With Federal Reserve Chairman Powell stating that he may cut interest rates at some point this year, industry insiders believe that once the Federal Reserve enters the interest rate cutting range, risk assets including Bitcoin may benefit.

In addition, some analysts believe that the increased trading enthusiasm in East Asian countries has boosted the price of Bitcoin. CITIC Securities stated that from 2015 to 2016, RMB-to-Bitcoin transactions accounted for almost all transactions, driving transaction volume to a record high while Bitcoin rose rapidly. The most important incremental traders in the current Bitcoin market are East Asian investors who can only invest in Bitcoin spot ETFs.

Many institutions warn of shock risks

Although the Bitcoin market is booming, many domestic and foreign institutions have warned of trading risks.

“Cryptocurrency is an unstable asset, and past bull markets have seen drawdowns of 20%-30% before prices continued to rise. Traders are advised to use leverage with caution, as price movements in both directions can lead to liquidations. ”said Parth Chaturvedi, investment director at CoinSwitch Ventures.

Recently, JPMorgan Chase issued a report on Bitcoin warning that the Bitcoin “halving” event will arrive in April, which may have a serious negative impact on the profitability of Bitcoin miners. As a result, the price of Bitcoin may plummet to $42,000 per coin, a potential drop of more than 36% from the current price.

CITIC Securities said that based on history, Bitcoin still has an upward trend before and after the "halving", and the positive factors in the East Asia-North America interest rate differential are expected to subside after the Federal Reserve begins to cut interest rates. The market currently lacks upward momentum, and the market outlook is expected to remain volatile.

Editor: Guo Chenxi Proofreader: Feng Wenjun Picture Editor: You Feifei

Reviewer: Zhu Jianhua Producer: Pu Hongyi Issuer: Lin Yanxing