The post Bitcoin-Led Crypto Bounce May Persist Amid Weak Capital Inflows appeared on BitcoinEthereumNews.com. The crypto market bounce refers to a 10.4% recovery in total market capitalization following an early Monday dip, with Bitcoin leading at 10.55% gains. This rebound occurs amid mixed U.S. economic signals, including government reopening and Federal Reserve policy shifts, though low capital flows temper sustained optimism. Bitcoin spearheaded the crypto market bounce with a 10.55% increase, outpacing many altcoins that saw even higher short-term returns. U.S. government operations resumed on November 13 after a 43-day shutdown, easing uncertainty but revealing weaker-than-expected job data from ADP. The Federal Reserve’s end to quantitative tightening and positive stock market performance, with the S&P 500 up 0.3%, supported broader financial sentiment amid AI-driven corporate investments. Crypto market bounce gains 10.4% as Bitcoin rebounds 10.55% post-dip. Explore macro influences like Fed policy and job data. Stay informed on volatility—subscribe for daily crypto insights today! What is driving the crypto market bounce in late 2023? The crypto market bounce stems from a swift recovery after an initial price drop, boosting total market capitalization by 10.4%. Bitcoin, as the market leader, surged 10.55%, while select altcoins achieved stronger percentage gains. This uptick aligns with stabilizing U.S. economic indicators, including the government’s reopening and the Federal Reserve’s decision to halt quantitative tightening, fostering cautious investor confidence. Macroeconomic developments played a pivotal role, as the 43-day government pause had withheld critical reports, heightening market volatility. Post-reopening, data from payroll processor ADP revealed a loss of 32,000 private sector jobs in November—contrary to expectations of a 40,000-job gain—yet the overall sentiment remained buoyed by equity market gains and expert assessments of the AI sector’s fundamentals. Analysts from Bank of America noted that the AI boom reflects genuine corporate investments rather than the speculative fervor of the dot-com era. Savita Subramanian, Bank of America’s head of equity and quantitative strategies,… The post Bitcoin-Led Crypto Bounce May Persist Amid Weak Capital Inflows appeared on BitcoinEthereumNews.com. The crypto market bounce refers to a 10.4% recovery in total market capitalization following an early Monday dip, with Bitcoin leading at 10.55% gains. This rebound occurs amid mixed U.S. economic signals, including government reopening and Federal Reserve policy shifts, though low capital flows temper sustained optimism. Bitcoin spearheaded the crypto market bounce with a 10.55% increase, outpacing many altcoins that saw even higher short-term returns. U.S. government operations resumed on November 13 after a 43-day shutdown, easing uncertainty but revealing weaker-than-expected job data from ADP. The Federal Reserve’s end to quantitative tightening and positive stock market performance, with the S&P 500 up 0.3%, supported broader financial sentiment amid AI-driven corporate investments. Crypto market bounce gains 10.4% as Bitcoin rebounds 10.55% post-dip. Explore macro influences like Fed policy and job data. Stay informed on volatility—subscribe for daily crypto insights today! What is driving the crypto market bounce in late 2023? The crypto market bounce stems from a swift recovery after an initial price drop, boosting total market capitalization by 10.4%. Bitcoin, as the market leader, surged 10.55%, while select altcoins achieved stronger percentage gains. This uptick aligns with stabilizing U.S. economic indicators, including the government’s reopening and the Federal Reserve’s decision to halt quantitative tightening, fostering cautious investor confidence. Macroeconomic developments played a pivotal role, as the 43-day government pause had withheld critical reports, heightening market volatility. Post-reopening, data from payroll processor ADP revealed a loss of 32,000 private sector jobs in November—contrary to expectations of a 40,000-job gain—yet the overall sentiment remained buoyed by equity market gains and expert assessments of the AI sector’s fundamentals. Analysts from Bank of America noted that the AI boom reflects genuine corporate investments rather than the speculative fervor of the dot-com era. Savita Subramanian, Bank of America’s head of equity and quantitative strategies,…

Bitcoin-Led Crypto Bounce May Persist Amid Weak Capital Inflows

2025/12/05 12:15
  • Bitcoin spearheaded the crypto market bounce with a 10.55% increase, outpacing many altcoins that saw even higher short-term returns.

  • U.S. government operations resumed on November 13 after a 43-day shutdown, easing uncertainty but revealing weaker-than-expected job data from ADP.

  • The Federal Reserve’s end to quantitative tightening and positive stock market performance, with the S&P 500 up 0.3%, supported broader financial sentiment amid AI-driven corporate investments.

Crypto market bounce gains 10.4% as Bitcoin rebounds 10.55% post-dip. Explore macro influences like Fed policy and job data. Stay informed on volatility—subscribe for daily crypto insights today!

What is driving the crypto market bounce in late 2023?

The crypto market bounce stems from a swift recovery after an initial price drop, boosting total market capitalization by 10.4%. Bitcoin, as the market leader, surged 10.55%, while select altcoins achieved stronger percentage gains. This uptick aligns with stabilizing U.S. economic indicators, including the government’s reopening and the Federal Reserve’s decision to halt quantitative tightening, fostering cautious investor confidence.

Macroeconomic developments played a pivotal role, as the 43-day government pause had withheld critical reports, heightening market volatility. Post-reopening, data from payroll processor ADP revealed a loss of 32,000 private sector jobs in November—contrary to expectations of a 40,000-job gain—yet the overall sentiment remained buoyed by equity market gains and expert assessments of the AI sector’s fundamentals.

Analysts from Bank of America noted that the AI boom reflects genuine corporate investments rather than the speculative fervor of the dot-com era. Savita Subramanian, Bank of America’s head of equity and quantitative strategies, described the current market as an “air pocket” rather than a bubble, emphasizing sustainable growth drivers. These factors collectively mitigated downward pressures on cryptocurrencies, allowing the bounce to materialize despite ongoing uncertainties.

How are capital flows influencing the Bitcoin rebound?

Bitcoin’s open interest has edged higher over the past three days but remains subdued compared to October peaks, signaling limited speculative engagement. Data from CoinGlass indicates this shallow growth reflects cautious trader sentiment, with bullish positions not yet matching prior levels. For a robust rebound, sustained increases in spot trading volumes and open interest are essential, as current patterns suggest the recovery lacks the depth for immediate long-term momentum.

Market observers, including those at TradingView, highlight that the total crypto market capitalization dipped below the $3.56 trillion support in September before stabilizing. The November 2023 trendline from the prior year acted as both resistance and renewed support, underscoring technical resilience. However, without stronger inflows, this Bitcoin rebound could falter, particularly as macro conditions like indecisive job reports and Federal Reserve signals continue to sway investor behavior.

Expert commentary from financial institutions like BlackRock reinforces this view, stating that real economic investments in technology sectors are underpinning broader market stability. Yet, in the crypto space, where volatility is amplified, traders must monitor spot demand closely. Historical data shows that rallies without robust capital flows often lead to consolidations, advising a measured approach to positioning.

Crypto bounce not supported by strong capital flows

Source: TOTAL on TradingView

The total crypto market cap fell below $3.56 trillion, a key support level, in September. It continued to trend downward, but something interesting happened over the past two weeks.

The trendline support (yellow) from November 2023 was breached in November. The retest of the same level as resistance, surprisingly, did not reject the total market cap.

It served as support once again in recent days. Perhaps the crypto bounce could continue in the coming weeks.

Source: CoinGlass

The Open Interest behind Bitcoin has slowly grown over the past three days, but it was still shallow compared to the October highs.

A lack of speculative interest showed that market confidence was still low, and bullish bets were not as big as earlier.

A sustained growth in spot demand and OI is necessary to drive the next rally. Until then, investors and traders can treat the bounce as a bounce and not expect a full recovery.

Frequently Asked Questions

What caused the recent crypto market bounce after the government shutdown?

The crypto market bounce followed the U.S. government’s reopening on November 13 after 43 days, releasing pent-up economic data like ADP’s November job loss report of 32,000 positions—below forecasts. Coupled with the Federal Reserve ending quantitative tightening and S&P 500 gains of 0.3%, these factors restored some stability, propelling Bitcoin’s 10.55% rise and overall market recovery.

Is the Bitcoin rebound sustainable given current open interest trends?

The Bitcoin rebound shows promise but lacks robust support from open interest, which has only modestly increased over three days per CoinGlass data, far from October highs. For sustainability, experts recommend watching for stronger spot demand and speculative volumes, as low confidence could limit upward momentum amid mixed macro signals like AI investment validations from Bank of America.

Key Takeaways

  • Cautious Optimism in Volatility: The crypto market bounce of 10.4% highlights resilience, but indecisive U.S. economic data urges investors to maintain balanced portfolios.
  • Role of Macro Policies: Federal Reserve’s quantitative tightening pause and positive stock performances signal potential for further crypto inflows if job reports improve.
  • Monitor Capital Flows: Track Bitcoin open interest and spot volumes closely, as sustained growth could confirm a lasting rebound beyond current technical supports.

Conclusion

In summary, the crypto market bounce and Bitcoin rebound reflect a interplay of U.S. government resumption, Federal Reserve actions, and expert-backed AI sector strength, though subdued open interest tempers expectations. As markets navigate these dynamics, sustained capital flows will be key to extending gains. Investors should stay vigilant, leveraging data-driven insights for informed decisions in this evolving landscape—consider exploring more on en.coinotag.com for ongoing updates.

Source: https://en.coinotag.com/bitcoin-led-crypto-bounce-may-persist-amid-weak-capital-inflows

Disclaimer: The articles reposted on this site are sourced from public platforms and are provided for informational purposes only. They do not necessarily reflect the views of MEXC. All rights remain with the original authors. If you believe any content infringes on third-party rights, please contact service@support.mexc.com for removal. MEXC makes no guarantees regarding the accuracy, completeness, or timeliness of the content and is not responsible for any actions taken based on the information provided. The content does not constitute financial, legal, or other professional advice, nor should it be considered a recommendation or endorsement by MEXC.

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Wang Yongli, former vice president of the Bank of China: Why did China resolutely halt stablecoins?

Wang Yongli, former vice president of the Bank of China: Why did China resolutely halt stablecoins?

Written by: Wang Yongli , former Vice President of Bank of China China's policy orientation of accelerating the development of the digital yuan and resolutely curbing virtual currencies, including stablecoins, is now fully clear. This is based on a comprehensive consideration of factors such as China's leading global advantages in mobile payments and the digital yuan, the sovereignty and security of the yuan, and the stability of the monetary and financial system. Since May 2025, the United States and Hong Kong have been racing to advance stablecoin legislation, which has led to a surge in global legislation on stablecoins and crypto assets (also known as "cryptocurrencies" or "virtual currencies"). A large number of institutions and capital are flocking to issue stablecoins and invest in crypto assets, which has also sparked heated debate on whether China should fully promote stablecoin legislation and the development of RMB stablecoins (including offshore ones). Furthermore, after the United States legislated to prohibit the Federal Reserve from issuing digital dollars, whether China should continue to promote digital RMB has also become a hot topic of debate. For China, this involves the direction and path of national currency development. With the global spread of stablecoins and the increasingly acute and complex international relations and fiercer international currency competition, this has a huge and far-reaching impact on how the RMB innovates and develops, safeguards national security, and achieves the strategic goals of a strong currency and a financial power. We must calmly analyze, accurately grasp, and make decisions early. We cannot be indifferent or hesitant, nor can we blindly follow the trend and make directional and subversive mistakes. Subsequently, the People's Bank of China announced that it would optimize the positioning of the digital yuan within the monetary hierarchy (adjusting the previously determined M0 positioning. This is a point I have repeatedly advocated from the beginning; see Wang Yongli's WeChat public account article "Digital Yuan Should Not Be Positioned as M0" dated January 6, 2021), further optimize the digital yuan management system (establishing an international digital yuan operations center in Shanghai, responsible for cross-border cooperation and use of the digital yuan; and establishing a digital yuan operations management center in Beijing, responsible for the construction, operation, and maintenance of the digital yuan system), and promote and accelerate the development of the digital yuan . On November 28, the People's Bank of China and 13 other departments jointly convened a meeting of the coordination mechanism for combating virtual currency trading and speculation. The meeting pointed out that due to various factors, virtual currency speculation has recently resurfaced, and related illegal and criminal activities have occurred frequently, posing new challenges to risk prevention and control. It emphasized that all units should deepen coordination and cooperation, continue to adhere to the prohibitive policy on virtual currencies, and persistently crack down on illegal financial activities related to virtual currencies. It clarified that stablecoins are a form of virtual currency , and their issuance and trading activities are also illegal and subject to crackdown. This has greatly disappointed those who believed that China would promote the development of RMB stablecoins and correspondingly relax the ban on virtual currency (crypto asset) trading. Therefore, China's policy orientation of accelerating the development of the digital yuan and resolutely curbing virtual currencies, including stablecoins, is now fully clear . 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First, the US dollar is the most liquid and has the most comprehensive supporting system of international central currencies, making stablecoins pegged to the dollar the easiest to accept globally. Second, it is also a result of the US's long-standing tolerant policy towards crypto assets like Bitcoin and dollar-denominated stablecoins, rather than leading the international community to strengthen necessary regulation and safeguard the fundamental interests of all humanity. Even this year, when the US pushed for legislation on stablecoins and crypto assets, it was largely driven by the belief that dollar-denominated stablecoins would increase global demand for the dollar and dollar-denominated assets such as US Treasury bonds, reduce the financing costs for the US government and society, and strengthen the dollar's international dominance. This was a choice made to enhance US support for dollar-denominated stablecoins and control their potential impact on the US, prioritizing the maximization of national interests while giving little consideration to mitigating the international risks of stablecoins. With the US strongly promoting dollar-denominated stablecoins, other countries or regions launching non-dollar fiat currency stablecoins will find it difficult to compete with dollar-denominated stablecoins on an international level, except perhaps within their own sovereign territory or on the issuing institution's own e-commerce platform. Their development potential and practical significance are limited . Lacking a strong ecosystem and application scenarios, and lacking distinct characteristics compared to dollar-denominated stablecoins, as well as the advantage of attracting traders and transaction volume, the return on investment for issuing non-dollar fiat currency stablecoins is unlikely to meet expectations, and they will struggle to survive in an environment of increasingly stringent legislation and regulation in various countries. The legislation on stablecoins in the United States still faces many problems and challenges. Following President Trump's second election victory, his strong advocacy for crypto assets such as Bitcoin fueled a new international frenzy in cryptocurrency trading, driving the rapid development of dollar-denominated stablecoin trading and a surge in stablecoin market capitalization. This not only increased demand for the US dollar and US Treasury bonds, strengthening the dollar's international status, but also brought huge profits to the Trump family and their cryptocurrency associates. However, this also posed new challenges to the global monitoring of the dollar's circulation and the stability of the traditional US financial system. Furthermore, the trading and transfer of crypto assets backed by dollar-denominated stablecoins has become a new and more difficult-to-prevent tool for the US to harvest global wealth, posing a serious threat to the monetary sovereignty and wealth security of other countries . This is why the United States has accelerated legislation on stablecoins, but its legislation is more about prioritizing America and maximizing American and even group interests, at the expense of the interests of other countries and the common interests of the world. 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