Sign in Subscribe

Market Outlook: Q4 2024

As we approach year-end, digital assets are at a turning point. November’s elections could redefine regulation, while Ethereum's scaling solutions promise to revolutionize finance. Asset tokenization and decentralized networks stand ready to disrupt existing systems. A transformative year beckons.

Gabriel Selby, Mark Pilipczuk

• 2 min read
Market Outlook: Q4 2024
Click Here to Explore

To access the full report, click here

Recalibrating for the New Monetary Cycle

Our market outlook for digital assets anticipates continued influence from macroeconomic shifts and technological progress. We view the growing appetite for Bitcoin and Ether ETFs as a tipping point, positioning them as integral pieces of diversified portfolios. On the macro front, subsiding inflation and rate cuts are likely to support increased asset valuation and investor sentiment. We expect November's election to provide more clarity on industry regulation, ultimately creating both opportunities and challenges as a comprehensive framework eventually emerges. Technologically, Ethereum's Layer 2 solutions are revolutionizing transaction capabilities, cementing its leadership in DeFi and stablecoin markets.

Market Summary:

Digital assets have shown resilience and growth in 2024, marked by significant institutional adoption milestones. The launch of spot Bitcoin and Ether ETFs in the US has attracted substantial inflows, signaling mainstream acceptance. Macroeconomic factors, including inflation and interest rate changes, have influenced the market. The upcoming US elections and potential regulatory changes are drawing attention, with digital assets gaining advocates across the political spectrum.

Macro Backdrop:

The Federal Reserve has begun cutting interest rates, with markets pricing in a more aggressive trajectory than official guidance. Global growth is projected to stabilize, with recession probabilities lower than at the start of the year. The US presidential election is too close to call, but regardless of outcome, it's seen as an opportunity for a more favorable regime change for the digital asset industry. Regulatory evolution is expected to be a critical inflection point for the sector. Furthermore, we are still anticipating a “soft landing” as our most probable outcome, with the scenarios and risks outlined below.

Secular Themes:

Ethereum's Layer 2 solutions are gaining traction, enhancing scalability while maintaining security and decentralization. Stablecoin adoption on Ethereum is growing rapidly, with the network processing nearly 40% of credit card network volumes. Asset tokenization is expanding beyond money market funds, potentially revolutionizing traditional finance. Decentralized Physical Infrastructure Networks (DePINs) are emerging as cost-effective alternatives to traditional cloud computing, particularly for GPU-intensive tasks like AI.

Asset Class Overview & Forecasts:

Analysts project positive returns across global equities, with Asian markets showing the highest expected gains. Interest rates are expected to decline in most major economies. Commodities show a mixed outlook. Currency forecasts suggest subtle shifts in global economic dynamics. GDP growth forecasts highlight divergent economic trajectories, with China maintaining higher growth and the US expected to moderate below trend.

To read the our full market outlook report, please click here.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell any of the underlying instruments cited including but not limited to cryptoassets, financial instruments or any instruments that reference any index provided by CF Benchmarks Ltd. This communication is not intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. Please contact your financial adviser or professional before making an investment decision.

CF Benchmarks Ltd (“CF Benchmarks”), a company registered in England and Wales with company number 11654816 and authorised and regulated by the Financial Conduct Authority. Information about us can be found on the Financial Services Register (register number 847100).

Registered Office: 6th Floor One London Wall, London, United Kingdom, EC2Y 5EB.

You agree not to, and have no rights to, use the CF Benchmarks Data to create, calculate, issue, settle, maintain, support or develop any financial instruments (including but, without limitation exchange traded products, certificates, warrants, contracts for difference, swaps, binary options, structured products), indices, products, services (including but without limitation, portfolio management services, pre- and post-trade risk management services, or valuation services) or any other derivative works without the express written consent of CF Benchmarrks.

You agree not to analyze, reverse-engineer or disassemble any CF Benchmarks data and not to insert any code or product to manipulate the Website content in any way that affects any user’s experience. Unless CF Benchmarks gives you prior written permission, use of any Web browsers (other than generally available third-party browsers), engines, scripts, software, spiders, robots, avatars, agents, tools or other devices or mechanisms (such as crawlers, browser plug-ins and add-ons, or other technology) to navigate, access, copy in bulk, retrieve, harvest, index, search or analyse any portion of the Website is strictly prohibited.

No part of this information may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission of CF Benchmarks Ltd. Use and distribution of the CF Benchmarks data requires a license from CF Benchmarks or its authorized licensing agents.

All information is provided for information purposes only. All information and data contained on this website is obtained by CF Benchmarks, from sources believed by it to be accurate and reliable. Such information and data is provided "as is" without warranty of any kind.

CF Benchmarks, nor its directors, officers, employees, partners or licensors make any claim, prediction, warranty or representation whatsoever, expressly or implied, either as to the accuracy, timeliness, completeness or merchantability of any information or of results to be obtained from the use of the CF Benchmarks indices or the fitness or suitability of the same indices for any particular purpose to which they might be put. Any representation of historical data accessible through CF Benchmarks indices is provided for information purposes only and is not a reliable indicator of future performance.

No responsibility or liability can be accepted by CF Benchmarks nor their respective directors, officers, employees, partners or licensors for any loss or damage in whole or in part caused by, resulting from, or relating to any error (negligent or otherwise) or other circumstance involved in procuring, collecting, compiling, interpreting, analysing, editing, transcribing, transmitting, communicating or delivering any such information or data or from use of this website or links to this website.

CF Benchmarks and its respective directors, officers, employees, partners or licensors do not provide investment advice and nothing accessible through CF Benchmarks, should be taken as constituting financial or investment advice or a financial promotion. Charts and graphs are provided for illustrative purposes only. Index returns shown may not represent the results of the actual trading of any assets.

CF Benchmarks is a member of the Crypto Facilities group of companies which is in turn a member of the Payward, Inc. group of companies. Payward, Inc. is the owner and operator of the Kraken Exchange, a venue that facilitates the trading of cryptocurrencies. The Kraken Exchange is a source of input data for certain CF Benchmarks indices. Payward, Inc. is the owner and operator of the Staked, a venue that operates the block production nodes for decentralized PoS protocols on behalf of institutional investors. Staked.us is a source of input data for certain CF Benchmarks indices.

Please refer to the individual product family documentation for more information about applicable input data sources.