Essential insights:
The recent SEC–CFTC roundtable emphasizing clearer digital asset regulation may bolster investor confidence.
A short-term resolution of the potential US government shutdown could reduce risk aversion and elevate Bitcoin prices.
Labor market data and expectations surrounding the Strategic Bitcoin Reserve may instigate renewed momentum toward the $120,000 threshold.
On Monday, Bitcoin (BTC) surpassed the $114,000 level, recovering some losses from the previous week. Notably, this upturn occurred despite significant outflows from spot Bitcoin exchange-traded funds (ETFs), leading investors to ponder the sustainability of the rally and potential catalysts propelling Bitcoin towards $120,000.
Approximately $900 million exited US-listed spot Bitcoin ETFs last week, which raised moderate concerns among traders, particularly as long-term holders sold 3.4 million BTC. According to Glassnode, around 90% of the coins transferred indicated profit-taking for the third time this cycle, heightening the probability of an upcoming “cooling phase.”
Joint SEC-CFTC roundtable, US government shutdown, and labor market data
This week features three events potentially influencing investor attitudes toward Bitcoin, beginning with a joint roundtable on digital asset regulation hosted by the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). SEC Chair Paul Atkins will inaugurate the event on Monday.
The Washington, D.C., meeting aims to clarify regulatory parameters regarding jurisdictional tests, listings, and exchange supervision. Panelists include Jeff Sprecher, CEO of ICE-NYSE, Adena Friedman, CEO of Nasdaq, and Terry Duffy, CEO of CME Group, alongside executives from major crypto-focused firms and representatives from JPMorgan, Bank of America, and Citadel.
Another factor that could influence Bitcoin’s value is the impending threat of a US government shutdown on Oct. 1. US President Donald Trump has arranged a meeting with congressional leaders on Monday to mitigate the crisis. Inaction from Congress could lead to the furlough of thousands of federal employees and disrupt various services, including small-business grant programs.
Historically, Bitcoin’s price reacts negatively when traders exhibit greater risk aversion. Around $1.7 trillion in “discretionary” spending aimed at funding agency operations is set to lapse at the end of the fiscal year on Tuesday. The House of Representatives narrowly passed a bill on Sept. 19 to finance government agencies until Nov. 21, now awaiting final approval from the Senate.
The forthcoming significant factor that might catalyze a Bitcoin rise to $120,000 is the US job market data, a primary focus for the Federal Reserve following core inflation aligning with market expectations at 2.9% in August. The US Bureau of Labor Statistics is set to publish the JOLTS survey of job openings on Tuesday, followed by the nonfarm payroll report on Friday.
Signs indicating weakness in the job market might drive investors toward safer assets like gold and short-term government bonds.
Related: Poland advances stringent crypto legislation, inciting public backlash
US Strategic Bitcoin Reserves may create psychological support
Another reason Bitcoin has maintained the $109,000 threshold is the optimism surrounding the establishment of a United States Strategic Bitcoin Reserve. Jan3 founder Samson Mow recently mentioned that the Trump administration is actively promoting budget-neutral strategies for Bitcoin acquisition. Some analysts also point to a possible reassessment of the US Treasury’s gold reserves.
By adjusting gold’s official value from the $42.22 level established by Congress in 1973, the US Treasury could potentially release nearly $1 trillion in credit, although US Treasury Secretary Scott Bessent has dismissed such speculations. Nonetheless, analysts remain optimistic about the government’s ability to successfully implement a Strategic Bitcoin Reserve in the upcoming months.
Factors that could elevate Bitcoin above $120,000 include enhanced regulatory clarity in the digital asset sector, a temporary resolution to avert a potential US government shutdown, and diminished risks reflected in upcoming US job market data. Furthermore, even the prospect of the US Treasury incorporating Bitcoin into its reserves offers a psychological support level for the market should these larger events turn adverse.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
