According to Binance Research, Bitcoin could establish a foundation of support prior to the initiation of official interest rate cuts by major central banks, provided that the expansion of rate hikes continues to lose momentum.
Out of the ten central banks monitored by Binance, eight have implemented rate increases over the prior six-month period, including the rate hike revealed by Sweden on November 4, though the overall pace of monetary tightening has begun to subside following its peak in July, as noted in a Tuesday publication released by Binance Research to Cointelegraph.
“Whether this easing continues into early 2027 will be key to judging whether the macro backdrop is turning less hostile for crypto,” the report stated.
Binance drew attention to historical precedent from the prior market cycle. Bitcoin (BTC) reached its cyclical trough in November 2022, while its performance over a six-month window shifted into positive territory by February 2023, well before any central banks within the tracked index initiated rate reductions.
Pace of G10 banks tightening and Bitcoin’s 6-month returns. Source: Binance Research
In a similar fashion, monetary restriction policies in 2024 propelled Bitcoin to generate its strongest six-month return metrics for that cycle, climbing past 160% in March, according to Binance.
“In each case, BTC moved with the direction of global policy, not its level,” the publication further explained.
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December rate hike odds mount following Waller’s speech
The possibility of an upcoming US interest rate increase remains active. Federal Reserve Governor Christopher Waller shared on Tuesday that he favored a twenty-five basis point upward adjustment in December, while noting he would evaluate a fifty basis point adjustment if core inflation readings stayed elevated. Probabilities favoring a quarter-point rate hike during December climbed from 76.3% to 96.3% on Tuesday, per data provided by the CME Group FedWatch Tool.
Within an analytical report published on November 2, Bitwise also suggested that a dampening of economic growth projections could eventually force central monetary authorities to pivot toward easing policies, potentially fostering a more supportive climate for Bitcoin.
BTC/USD, 1-year chart. Source: CoinMarketCap
The valuation of Bitcoin dropped by 3.5% across the preceding week, pushing its annualized twelve-month drop to 30%. The leading global cryptocurrency changed hands at $74,131, sitting roughly 41% under its all-time peak valuation of $126,198, as reported by CoinMarketCap.
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Originally published at https://cointelegraph.com/markets/bitcoin-price-global-tightening-binance-research?utm_source=rss_feed&utm_medium=rss&utm_campaign=rss_partner_inbound.
