Activation of Old Bitcoin Addresses Triggers Market Fluctuation, US Fiscal Policy May Become a Favourable Information Factor

Recently, 8 Bitcoin addresses that had been dormant for 14 years were suddenly activated, holding a total of 80,000 Bitcoins, which caused a brief decline in the market. According to analysis, these addresses may belong to an independent miner from 2011, who had accumulated mining rewards from 180 blocks and once held 200,000 Bitcoins, making him the fifth largest holder in Bitcoin's history.

The main reason for market concerns is that the holding cost of these Bitcoins is only $1.76 each, and at the current price of $108,000, the unrealized gains amount to as much as 61,000 times. A large-scale sell-off could potentially have a huge impact on the market. Referencing the market turbulence caused by the German government's sale of nearly 50,000 Bitcoins in 2024 (with a maximum drop of 32%), the potential selling pressure of 80,000 Bitcoins could lead to even more severe market fluctuations.

There are various speculations in the market regarding the reasons behind the sudden awakening of these "sleeping" Bitcoins. Some believe it may be due to miners accidentally recovering hard drives that stored private keys, while others speculate it may be related to recent market trends. Based on the current situation, the latter possibility seems greater. The main reasons are: First, whales have only transferred Bitcoin to new addresses without further actions, which aligns with the security management practices of large holders; second, after the information was leaked, the market reacted calmly, with the secondary market price only dropping by 1.09%, and no significant signs of a rush to sell.

At the same time, a series of policy trends from the U.S. government may bring Favourable Information to the Bitcoin market. On July 4th, the U.S. President signed the "Great and Beautiful Act", marking the implementation of a large-scale tax reduction and fiscal spending plan. This act is expected to lead to a federal budget deficit increase of up to $5 trillion, significantly exceeding the $2.43 trillion of the previous "Tax Cuts and Jobs Act".

Although in the long term this bill may exacerbate the U.S. debt problem, in the short term, the permanent reduction of personal income tax and estate tax, the increase in the standard deduction, and certain tax exemption measures are expected to increase residents' income, stimulate consumption, and boost the market.

In addition, the Federal Reserve is considering adjusting the Supplementary Leverage Ratio (SLR) rules for the banking system, potentially lowering the requirement for large banks from 5% to 3.5%, and considering excluding low-risk assets from the leverage ratio calculation. This adjustment is expected to free up about $2 trillion in balance sheet space for large U.S. banks and help lower long-term yields on U.S. Treasuries.

Currently, the macro policy mix in the United States is clear: new debt will be jointly undertaken by the banking system and the stablecoin legislation, while the Federal Reserve's interest rate cuts will provide foundational liquidity support for this. This policy mix is expected to continue supporting risk assets, including Bitcoin, to remain strong in the short term.

From a technical perspective, Bitcoin is still in the main rising wave stage, and short-term market fluctuations only cause intraday level fluctuations. With strong consensus support, the possibility of a deep adjustment in Bitcoin is relatively small. After a brief consolidation, prices are expected to continue rising, with a long-term target range of 127600-137500.