The cryptocurrency market extended its pullback on Monday. After briefly dipping to around $65,000 over the weekend, Bitcoin staged a minor rebound, consolidating near the $67,000-$68,000 range. This represents a decline of over 8% from its recent all-time high. Ethereum fell below $3,500 before recovering above that level by the U.S. market close, registering a nearly 3% loss over 24 hours.
Among the top 10 altcoins by market capitalization, only Solana (SOL) and Avalanche (AVAX) posted positive gains in the past day. Dogecoin led the losses with a 6% drop, while BNB and ADA each declined around 3%.
Data tracked by Santiment indicates that SOL and the Solana-based meme token The Book of Meme (BOME) have been the most discussed tokens over the past two days. SOL's price has surged 45% in a week, breaking above $200 for the first time since December 2021, though it remains below its November 2021 all-time high of $259.96.
The momentum for BOME continues as well. Cryptocurrency exchange Binance listed BOME perpetual futures on March 16. Since its initial listing on March 10, BOME has skyrocketed 82%.
Santiment noted in its market report: "BOME and SOL are the two most popular assets on X, Reddit, Telegram, and 4Chan due to their recent market outperformance. There is a continued perception that Solana and its meme coins are a viable alternative to Ethereum ecosystem projects."
According to Santiment, social media mentions of "SOL" have risen to 322. Meanwhile, Google Trends, which measures interest in popular search topics, briefly showed a value of 100 for global searches for "solana". A score of 100 represents the peak search interest for a term within a given timeframe. This indicates a significant increase in people seeking information about Solana online.
The buzz around the Solana ecosystem echoes its rebounding token price. Data tracked by Top Ledger and OurNetwork shows that the trading volume on Solana-based decentralized exchanges has reached $30 billion this month, a tenfold increase from a year ago.
Bitcoin in Pre-Halving Retracement, Standard Chartered Predicts $150K by Year-End
Some analysts believe that, based on historical patterns, Bitcoin is currently in a pre-halving retracement phase.
Crypto trader and independent analyst Rekt Capital posted on X that the ongoing price action is part of the typical pre-halving pullback. In the 2016 and 2020 halving cycles, BTC experienced retracements of 38% and 20%, respectively.
Lucas Kiely, Chief Investment Officer at Yield App, also warned that Bitcoin is entering a pre-halving "danger zone."
Kiely stated: "Bitcoin’s price action over the past week is a preview of the volatility to come and a clear signal to fasten our seatbelts as we enter the pre-halving ‘danger zone.’ In the days leading up to the halving, BTC plummeted 40% in 2016 and 20% in 2020; we are simply preparing for this cycle’s pre-halving price action." Kiely predicts Bitcoin could see a 20% correction, potentially fluctuating around the $60,000 level.
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In contrast, Standard Chartered has revised its year-end price prediction for Bitcoin upwards, from $100,000 to $150,000. The bank further anticipates BTC will reach a cycle high of $250,000 in 2025 before stabilizing around $200,000.
Standard Chartered has become one of the more Bitcoin-friendly traditional banks, maintaining an active research team focused on Bitcoin. Previously, the bank's analysts had forecast a $100,000 price target for Bitcoin by the end of 2024.
The bank's analysis draws a comparison between the launch of gold ETFs in the U.S. and their impact on gold's price, correlating ETF inflows with BTC's price movements. The report stated: "We think the gold analogy—in terms of ETF impact and optimal portfolio allocation—remains a good starting point for estimating the ‘right’ medium-term Bitcoin price level."
In a separate report, Standard Chartered also predicted that a spot Ethereum ETF is expected to be approved by May 23. This could lead to inflows of up to $45 billion within the first 12 months, potentially pushing the price of Ethereum to $8,000 by the end of 2024.
The report added: "By 2025, we expect the ETH-to-BTC price ratio to return to the 7% level that prevailed for much of 2021-22. Given our estimated year-end 2025 BTC price level of $200,000, this implies an ETH price of $14,000."
Macroeconomic Factors at Play
The pre-halving retracement coincides with the conclusion of the U.S. Federal Open Market Committee (FOMC) meeting on March 20. Following last week's hotter-than-expected inflation data, investors are keenly watching for signals regarding potential Federal Reserve rate cuts.
Economists at Goldman Sachs have already revised their forecast for Fed rate cuts, now anticipating three cuts this year instead of the four previously predicted. The swaps market has also dialed back bets on Fed easing, now indicating less than a 50% probability of a 25-basis-point cut in June.
To date, Bitcoin's price has continued to be directly influenced by macroeconomic events. Further regulatory actions and the Federal Reserve's monetary policy are likely to remain significant factors affecting its price trajectory.
Frequently Asked Questions
What is a pre-halving retracement in Bitcoin?
A pre-halving retracement refers to a period of price decline Bitcoin often experiences in the weeks leading up to its halving event. Historically, this has been followed by a significant bull run, making it a noted phase in the market cycle for investors to watch.
Why is the Solana ecosystem performing well currently?
Solana is experiencing heightened interest due to strong performance of its native token, SOL, and popular meme tokens built on its network, like BOME. Increased social media discussion, high trading volumes on its DEXs, and its perception as an alternative to Ethereum are key drivers.
How do Federal Reserve decisions impact Bitcoin's price?
Bitcoin, as a risk asset, can be sensitive to macroeconomic policy. Expectations of interest rate cuts can be positive for liquidity and risk appetite, potentially boosting its price. Conversely, expectations of sustained higher rates can lead to pullbacks as investors seek safer assets.
What is the significance of a spot Ethereum ETF?
The approval of a spot Ethereum ETF would provide a traditional, regulated pathway for institutional and retail investors to gain exposure to ETH without directly holding it. This is widely expected to bring significant new capital into the Ethereum market.
What was Standard Chartered's previous Bitcoin price prediction?
Prior to its updated forecast, Standard Chartered analysts had predicted that Bitcoin would reach a price of $100,000 by the end of 2024. Their new prediction is considerably more bullish at $150,000.
How does the Bitcoin halving affect its price long-term?
The halving reduces the rate at which new Bitcoin is created, effectively cutting the new supply entering the market. Historically, this supply shock, coupled with sustained or increasing demand, has led to substantial price increases in the months and years following the event.