Here’s why analysts don’t expect Bitcoin’s price to rise further

Bitcoin’s price is under pressure once again, dipping below the $100k mark, as analysts point to global factors contributing to the market’s cautious outlook. One of the key drivers of uncertainty is the rise of Deepseek, a new AI startup in China that has the potential to challenge the United States’ dominance in the tech and AI sectors. Deepseek’s cost efficiency and open-source approach have raised concerns in the markets, and analysts are now contemplating how this could impact global trade, particularly with Bitcoin’s status as a risk asset.

QCP Capital, in a recent Telegram post, highlighted that the launch of Deepseek could disrupt the U.S. AI market and subsequently affect global markets, including cryptocurrencies like Bitcoin. Traders are keeping a close eye on this development as it could have significant implications for the U.S. equity markets. Furthermore, there’s been talk of a “Strategic Bitcoin Reserve,” a potential move to counter this rising threat, but QCP analysts noted that no concrete actions have been taken so far. Until there’s a clear indication from the U.S. government about a reserve or any measures to address the challenges posed by China’s tech advancements, they don’t foresee Bitcoin breaking higher anytime soon.

The lack of major developments in the cryptocurrency space and the looming geopolitical uncertainties have led analysts to believe that Bitcoin will continue to trade within a range for the time being. According to QCP, the options market is reflecting this sentiment, with traders primarily hedging their bets ahead of the upcoming Federal Open Market Committee (FOMC) meeting on January 30. Risk reversals are skewed in favor of call options only from March onwards, suggesting that the market is not expecting much movement until the end of Q1.

The main factor keeping Bitcoin’s price stable, according to QCP, is the possibility of further action from President Donald Trump, who could take a more aggressive stance against China in the form of tariffs or other restrictions. If Trump acts decisively, it could bring some resilience to Bitcoin’s price, helping it to maintain its current range.

For now, Bitcoin is facing headwinds from the broader risk asset slump and uncertainty surrounding geopolitical tensions, especially with China’s advancements in AI. Until there’s a clear strategic move regarding the potential Bitcoin reserve or any concrete response to China’s growing influence, analysts are cautious about Bitcoin’s immediate prospects. The market may remain in a holding pattern, with potential volatility depending on global political developments and the actions of key figures like Trump.