The upcoming meeting of the US Federal Reserve System (FRS), scheduled for January 31, and the published plans of the US Treasury regarding borrowing may have an impact on available liquidity and, consequently, on the movement of the exchange rate of the first cryptocurrency. This analysis was provided by specialists from QCP Capital.

In the first case, experts expect information about the rate of reduction of the Central Bank's balance sheet. If this process slows down, it helps to increase the available liquidity in the financial system.

In the second case, analysts expect to maintain the existing strategy of the Ministry of Finance related to the concentration of investments in short-term securities.

There are two main reasons for this strategy:

The US presidential election, which took place in November. Supporting the increase in available liquidity and the growth of American stocks may be positive for the current administration, as this may contribute to maintaining the position of Finance Minister.
In anticipation of a reduction in the Fed's key interest rate, the US Treasury may postpone borrowing in "long securities" until interest payments decrease.
The implementation of such a scenario can have a positive impact on risky assets, including cryptocurrencies. Otherwise, an increase in bond yields may lead to a wave of sales on the stock market.

The current decline in the price of bitcoin to below $40,000 is associated with the sales of the Grayscale Bitcoin Trust (GBTC) exchange-traded fund, which manages assets worth $21 billion, as well as concerns about creditors withdrawing from positions on the Mt.Gox exchange. According to analysts, this could lead to an additional offer of between 142,000 and 200,000 bitcoins.

CryptoQuant analysts also note increased pressure from large investors, which differs from the previous situation when retail investors (with less than 1 BTC) played a more active role.

Galaxy Digital CEO Mike Novogratz expressed optimism about the impact of GBTC sales on bitcoin's prospects.

Previously, the dependence of the bitcoin price on the wave of liquidation of positions in the Grayscale exchange-traded fund has already been noted.