Bitcoin’s Next Catalyst Could Be Hiding in the US Housing Market

[Lexandroove]

It comes as no news that as Bitcoin has gotten more established in infrastructure and value through the years, it has become increasingly sensitive to the same macroeconomic forces that drive housing, particularly interest rates and liquidity, which has got me thinking quite a bit.

As of yesterday, a record number flashed across the US housing market, where sellers outnumbered buyers by 57.9% in August, the widest gap in Redfin records dating back to 2013, which indicates that America is drowning in homes for sale. Still, most can't find a buyer, with Redfin estimating around 972,300 homebuyers left in the market.

Putting it in more straightforward terms, supply is recovering, while demand stays historically weak.

It raises the question: Seeing as weak housing market data is potentially bullish for Bitcoin, owing to the potential for the FED to cut rates or ease financial conditions, with lower rates likely to increase liquidity and make risk assets like Bitcoin more attractive, could this play a major role in an imminent rally for BTC?

[BIT-BENDER]

It raises the question: Seeing as weak housing market data is potentially bullish for Bitcoin, owing to the potential for the FED to cut rates or ease financial conditions, with lower rates likely to increase liquidity and make risk assets like Bitcoin more attractive, could this play a major role in an imminent rally for BTC?

What do mean that weak market data is potentially bullish for Bitcoin, can you back that with real facts? Drop something a chart, stats or anything even a link that can actually prove this to be correct.

The US housing market isn't going to be a significant factor towards Bitcoin being bullish, the US housing market is important don't get me wrong but if we see this as a significant factor then maybe the next significant factor towards Bitcoin bullishness would be the US healthcare.

[Lexandroove]

It raises the question: Seeing as weak housing market data is potentially bullish for Bitcoin, owing to the potential for the FED to cut rates or ease financial conditions, with lower rates likely to increase liquidity and make risk assets like Bitcoin more attractive, could this play a major role in an imminent rally for BTC?

What do mean that weak market data is potentially bullish for Bitcoin, can you back that with real facts? Drop something a chart, stats or anything even a link that can actually prove this to be correct.

The US housing market isn't going to be a significant factor towards Bitcoin being bullish, the US housing market is important don't get me wrong but if we see this as a significant factor then maybe the next significant factor towards Bitcoin bullishness would be the US healthcare.

The connection might not be as “on the nose”, but it’s there. Housing is one of the most interest-rate-sensitive parts of the economy, so weak housing can be a signal of restrictive financial conditions.

The FED itself notes that higher rates have reduced housing demand and activity.

The potential BTC bullishness comes if that weakness contributes to expectations of the FED easing, lower rates and looser financial conditions.

Here are some links that I believe would be useful in this regard:

https://x.com/Barchart/status/2098275428020433307

https://x.com/KobeissiLetter/status/2091545538671804495

https://s.yimg.com/lo/mysterio/api/89ef5f98ccaaa0caeacc87e61d80b15cc0e9bc8cf5865a147c1cc9261c79815c/lightyear_networkapi/resizefit_w960%3Bquality_80%3Bformat_webp/https%3A%2F%2Fmedia.zenfs.com%2Fen%2Fbeincrypto_us_662%2F6445f076b2dab3d818e8521650c3b83f.png

[pooya87]

In the big picture, Bitcoin is not affected by other markets at all. The only thing that can significantly affect bitcoin is whatever happens to the global economy at a large scale. Like the COVID recession which was global and pushed bitcoin price down significantly.

I don't follow US housing market to know what is going on in it but based on what you described, I don't see anything significant that can affect bitcoin in a meaningful way. If it were some sort of housing crisis (not just a simple "imbalance") it would have been a different story.

As for interest rates, the recent rate rise to 5% on the 10 year treasury notes is a negative sign which is big enough that indicate a worsening recession in the US. The recession side can negatively affect bitcoin but the fact that this is also lowering the faith in the US dollar and the fact that dedollarisation is moving forward faster than even (specially after the recent BRICS meeting) that can be a significantly positive sign.

[hugeblack]

The result may appear in interest rates, which could affect the liquidity available to investors to buy Bitcoin, which negatively affects the price, but there is no direct link between Bitcoin price and the US housing market, just as there was no direct link between them and the stock market, technology shares, and other things that we have been hearing in recent years.

[Taskford]

In the big picture, Bitcoin is not affected by other markets at all. The only thing that can significantly affect bitcoin is whatever happens to the global economy at a large scale. Like the COVID recession which was global and pushed bitcoin price down significantly.

I don't follow US housing market to know what is going on in it but based on what you described, I don't see anything significant that can affect bitcoin in a meaningful way. If it were some sort of housing crisis (not just a simple "imbalance") it would have been a different story.

As for interest rates, the recent rate rise to 5% on the 10 year treasury notes is a negative sign which is big enough that indicate a worsening recession in the US. The recession side can negatively affect bitcoin but the fact that this is also lowering the faith in the US dollar and the fact that dedollarisation is moving forward faster than even (specially after the recent BRICS meeting) that can be a significantly positive sign.

There's huge possibilities that if there's recession happens there's  sell pressure will occur, but also dedollarisation might flip those narratives. Especially that lots of country now starting to shift away and try to slowly decrease their reliance on USD.

Bitcoin truly benefit with those situation, since many countries treats it as neutral currency.

The situation happening can actually drag the price and it can affect it for short term, then eroding trust towards USD then BRICS intention to look for better alternative can help Bitcoin a lot for long term.

So let see if those situations  can help strengthen up the role of Bitcoin to be the best option for global reserve asset.

[Lexandroove]

In the big picture, Bitcoin is not affected by other markets at all. The only thing that can significantly affect bitcoin is whatever happens to the global economy at a large scale. Like the COVID recession which was global and pushed bitcoin price down significantly.

I don't follow US housing market to know what is going on in it but based on what you described, I don't see anything significant that can affect bitcoin in a meaningful way. If it were some sort of housing crisis (not just a simple "imbalance") it would have been a different story.

As for interest rates, the recent rate rise to 5% on the 10 year treasury notes is a negative sign which is big enough that indicate a worsening recession in the US. The recession side can negatively affect bitcoin but the fact that this is also lowering the faith in the US dollar and the fact that dedollarisation is moving forward faster than even (specially after the recent BRICS meeting) that can be a significantly positive sign.

There's huge possibilities that if there's recession happens there's  sell pressure will occur, but also dedollarisation might flip those narratives. Especially that lots of country now starting to shift away and try to slowly decrease their reliance on USD.

Bitcoin truly benefit with those situation, since many countries treats it as neutral currency.

The situation happening can actually drag the price and it can affect it for short term, then eroding trust towards USD then BRICS intention to look for better alternative can help Bitcoin a lot for long term.

So let see if those situations  can help strengthen up the role of Bitcoin to be the best option for global reserve asset.

Yeap. For the longer term, continued diversification away from the dollar could strengthen Bitcoin's appeal as a neutral, non-sovereign asset.

As it stands, it’s looking like short-term liquidity vs long-term monetary credibility. If confidence in traditional reserve assets continues to depreciate, its fixed supply and borderless nature could be considered a lot more attractive, though competitors such as the euro, gold, yuan, or other currencies exist as alternatives to Bitcoin in such a scenario.

[obuoma]

I don't want to dwell in hypothesis because there is no direct correlation between Bitcoin and the housing market of the US. Housing may affect the US policy to a great extent but that is not enough to say that it can catalyze the Bitcoin market directly. If there is anything that should affect Bitcoin, it should be things that has direct relationship with Bitcoin such as cost of energy and laws governing its regulations since Bitcoin mining is energy dependent.

[Hatchy]

though competitors such as the euro, gold, yuan, or other currencies exist as alternatives to Bitcoin in such a scenario.

I'm not exactly sure how the euro, gold, or yuan are competitive with Bitcoin. They are not really alternatives in the same sense because they are different types of assets. Bitcoin is a digital asset, while the others are currencies or a precious metal, and each is influenced by different economic factors.What I'm more concerned about is the effect of U.S. economic data on Bitcoin. With U.S. interest rates expected to rise, the dollar has been showing strength following some of the recent economic data releases. For example, the strong NFP report pushed the dollar and Treasury yields higher, while Bitcoin reacted to the downside.
So my main concern isn't necessarily Bitcoin competing with these other assets. I'm more interested in how things like NFP, CPI, interest rate decisions, and other economic data that influence Fed policy could affect Bitcoin in the short term.

[Z-tight]

If we take the U.S. housing market out of the discussion, what you are simply saying is you believe the Feds would cut interest rate soon and that should provide liquidity that would flow into the BTC market and cause the price to rise, right?

While you have surely put some thought into your points, it is all hypothetical and even if we agree this is all going to happen, not sure how much of an impact it can be. I believe it is better to see how things unfold, rather than trying to look for what's going to be the next 'catalyst' or something like that.

[dzungmobile]

What do mean that weak market data is potentially bullish for Bitcoin, can you back that with real facts? Drop something a chart, stats or anything even a link that can actually prove this to be correct.

The US housing market isn't going to be a significant factor towards Bitcoin being bullish, the US housing market is important don't get me wrong but if we see this as a significant factor then maybe the next significant factor towards Bitcoin bullishness would be the US healthcare.

Conditions for Bitcoin adoption, value and price growth are very massive, and have existed a long time even before Bitcoin Genesis Block appearance in 3 January 2009. Moving towards the future, there will be good conditions for such growth because the reality is governments and central banks globally won't change their national and economic governance, so it's only vision and choice of nations, companies, institutions and individuals to choose Bitcoin as their wealth storage moving forwards.

Bitcoin has its cycle, and other markets have their cycles too, while global economic recessions have own cycles. IF anyone feel like understanding about all these markets and their cycles is too complicated and headache, they can simply focus on Bitcoin and its cycle.

Buy BTC, hold BTC with a working strategy such as DCA, and get profit with time. What happen with the other markets will no longer headache factors.
Bitcoin market is like other markets, has its cycle. Focus on its cycle!

[348Judah]

I don't want to dwell in hypothesis because there is no direct correlation between Bitcoin and the housing market of the US. Housing may affect the US policy to a great extent but that is not enough to say that it can catalyze the Bitcoin market directly.

Additionally, it is not everything that has a direct impact on Bitcoin market price performance when we compare them together, this is why the entire bitcoin network does not stand dependent of any policy or centralized system or performance, everything about bitcoin is indicating an entirely independent network with the blockchain and what influences the price most is based on its demand and supply, well every other thing fall under just a mere reaction that could be insignificantly observed over its market value.

[EarnOnVictor]

-snip-
It raises the question: Seeing as weak housing market data is potentially bullish for Bitcoin, owing to the potential for the FED to cut rates or ease financial conditions, with lower rates likely to increase liquidity and make risk assets like Bitcoin more attractive, could this play a major role in an imminent rally for BTC?

The answer is no! I don't know why you think this could be a catalyst in the first place.

Fine, the USD is majorly paired with Bitcoin (BTC/USD), which is why anything happening for or against the greenback would affect the price of Bitcoin as well. But this is not automatically significant, and since I have been studying the reaction of Bitcoin during housing announcements, they are very insignificant and temporary, so how would this be different?

Serious events related to the USA/USD, like the double debt-buying QE that was announced in August, are the only important news that could catalyse Bitcoin.

[aoluain]

In the big picture, Bitcoin is not affected by other markets at all. The only thing that can significantly affect bitcoin is whatever happens to the global economy at a large scale. Like the COVID recession which was global and pushed bitcoin price down significantly.

I don't follow US housing market to know what is going on in it but based on what you described, I don't see anything significant that can affect bitcoin in a meaningful way. If it were some sort of housing crisis (not just a simple "imbalance") it would have been a different story.

As for interest rates, the recent rate rise to 5% on the 10 year treasury notes is a negative sign which is big enough that indicate a worsening recession in the US. The recession side can negatively affect bitcoin but the fact that this is also lowering the faith in the US dollar and the fact that dedollarisation is moving forward faster than even (specially after the recent BRICS meeting) that can be a significantly positive sign.

Yea its going to be something global which will be the Bitcoin markets next big catalyst.

I think the OP is onto something though, meaning its going to be US related or something global which
will be triggered by the US. The channels we listen to are all saying it - that the US ecomony is looking
like its going to fail. It may not be the housing sector as the OP suggests, it will probably be the artificial
economy based around the petro dollar.

I don't want to dwell in hypothesis because there is no direct correlation between Bitcoin and the housing market of the US. Housing may affect the US policy to a great extent but that is not enough to say that it can catalyze the Bitcoin market directly.

Additionally, it is not everything that has a direct impact on Bitcoin market price performance when we compare them together, this is why the entire bitcoin network does not stand dependent of any policy or centralized system or performance, everything about bitcoin is indicating an entirely independent network with the blockchain and what influences the price most is based on its demand and supply, well every other thing fall under just a mere reaction that could be insignificantly observed over its market value.

Of course - the Bitcoin network is independent/decentralised but the market is a different matter altogether,
it reacts to our emotions and our relationship with FIAT, and our emotions and reatcions to global economic trends

[Sammysmart001]

The result may appear in interest rates, which could affect the liquidity available to investors to buy Bitcoin, which negatively affects the price, but there is no direct link between Bitcoin price and the US housing market, just as there was no direct link between them and the stock market, technology shares, and other things that we have been hearing in recent years.

I would say that the lack of a direct link doesn’t mean that housing market can’t matter at all, housing can be of one part of economic data that do influences expectations about liquidity and interest rate. But form my own end the biggest question is that what happens after the data comes out ? Risk assets  including Bitcoin can be affected if weak housing data increases. But I won’t treat housing data alone as a guaranteed catalyst.

[BlackHatCoiner]

If the housing market cools just enough to bring down shelter inflation, allowing the Fed to gradually lower rates without triggering a recession, then yes, that is bullish. Lower yields push capital further out on the risk curve, and Bitcoin is a prime beneficiary of that fresh money.

However, if this data is the canary in the coal mine for a broader recession, the short-term reality for BTC could be ugly.

[Cryptomultiplier]

If the housing market cools just enough to bring down shelter inflation, allowing the Fed to gradually lower rates without triggering a recession, then yes, that is bullish. Lower yields push capital further out on the risk curve, and Bitcoin is a prime beneficiary of that fresh money.

However, if this data is the canary in the coal mine for a broader recession, the short-term reality for BTC could be ugly.

You know that most investors care less about federal reserve policy against lower interest rates, and that's because they buy mostly because they see the signs and that's why the smart money investors will continue to buy BTC as real time housing data weakens, because that's a better positioning strategy while the economy cools down or not.

[pooya87]

As it stands, it’s looking like short-term liquidity vs long-term monetary credibility. If confidence in traditional reserve assets continues to depreciate, its fixed supply and borderless nature could be considered a lot more attractive, though competitors such as the euro, gold, yuan, or other currencies exist as alternatives to Bitcoin in such a scenario.

Fiat currencies may be used in some cases to replace the dollar (eg. Petroyuan replacing Petrodollar in some cases) but we can't call them "competitors" and put them in the same category as hard assets such as gold or bitcoin. All fiats are bad since they have unlimited supply and apart from Chinese economy, all economies are facing severe crises so their fiat is not a viable option at all.

[OgNasty]

I don't think this is a good take at all.  The fact people can't even afford housing, how are they going to afford to stack BTC?  Common sense says that the worse the economy gets, the harder it is going to be for Bitcoin to rally.  We're seeing housing become a disaster before our eyes.  Layoffs are going to start in October and credit limits are already being tightened in expectation of credit defaults.  Anyone needing to raise cash next quarter is going to be in for a bad time.  I don't see that as being bullish for Bitcoin, but I do see it as being so terrible that it creates a bottom and a buying opportunity in the coming months.

[Somegory]

I believe that there was a time where the US government cares not about Bitcoin and it still made a new all time high, what will triggered the next is not in the US housing market, if you know how to read your chart very well you will know that we are going up anyways.

Bitcoin doesn't need some catalyst, if buying and selling keeps happening there will always be a time for massive pump and a time for massive retracement, it's just the chart doing it's thing.

Bitcoin doesn't need to confuse smart investors, when the value is right for buying they will swim in right away, Bitcoin will be fine on its own without the government interference, new ATH will still always happen.