Sidelined Capital Rotation May Fuel Bitcoin Rebound
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A significant $7.8 trillion remains parked in U.S. money market funds, representing substantial dry powder that could flow into risk assets. With the Federal Reserve's easing cycle now 522 days underway, historical patterns suggest we're entering a typical window for capital rotation from safe havens to higher-risk opportunities. This timing aligns with potential inflection points for digital assets.
Bitcoin stands to benefit disproportionately from such rotations due to its established position as a leading risk-on asset within the crypto ecosystem. The sheer scale of sidelined capital indicates that even a modest reallocation could drive outsized price movements. Market participants should monitor fund flow data and broader risk appetite indicators for confirmation of this historical trend manifesting in current conditions.
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