Derive Predictions Update: January 31st 2025
Derive.xyz Predicts 10% chance of BTC dropping to $75K before March
January 31st, 2025, By Nick Forster
This blog explores the current market outlook for Bitcoin and Ethereum, examining short-term predictions, the growing momentum for state-level BTC reserves in the US, and the shifting sentiment towards Ethereum's price movements.
BTC unlikely to fall below $75K before February 28
While some crypto leaders are betting on BTC to fall before rallying towards $250K later this year, the Derive.xyz market remains skeptical. In fact, there’s a 9.7% chance of BTC falling below $75K before March, and an even less likely 4.4% chance that it will swing over $250K before September 26.
In the US, we’re seeing momentum building for state-level BTC reserves in states including Texas, Utah, and Arizona. While Trump’s initial days in office didn’t bring a federal BTC reserve, with more states proving the profitability of such measures, this could culminate in the federal government following suit. This could propel bullish sentiment for BTC.
Looking towards the end of this quarter, the probability of BTC reaching over $115K by March 28 is 8%, down from 16% last week. While there’s a 95% chance of settling between $65.5K and $156.6K (down from $65.2K and $173K last week).
Increased likelihood of a short-term ETH slump
Derive.xyz shows a more bearish market sentiment for ETH, with a 25% chance of ETH falling below $2.5K by February 28, up from 15.3% last week. Longer term, however, there is a 35.5% chance of ETH hitting $5K by September 26.
ETH’s TVL continues to be affected by competition from Solana, SUI, and Aptos, though new initiatives like Ethrealize could spark longer-term price movements in Q2.
However, despite short-term market fluctuations, fears of Chinese AI dominance are expected to be short-lived. The US is likely to capitalize on sectors such as AI and crypto, which it has a comparative advantage in. Trump-linked companies, like World Liberty Financial, are actively investing in ETH, with over $100M in holdings, signaling long-term bullish sentiment.
By March 28, Derive.xyz predicts a 15% chance of ETH hitting above $4K by March 28, dropping from 22% last week.