Bitcoin Soars to New 2024 High Amid Anticipation of Supply Halving Event and ETF Inflows
Summary:
Bitcoin price experienced a significant surge, reaching a new 2024 high at $64,000, largely due to investors' anticipation of the upcoming supply halving event and the inflow into newly launched spot Bitcoin ETFs. Despite concerns about heavy leverage usage, analysts remain optimistic about the current Bitcoin price rally, citing strong market trends and record ETF inflows. Currently, Bitcoin is less than 13% away from its all-time high, with expectations of surpassing it before the supply halving event.
Bitcoin (BTC) experienced a notable surge of over 10%, hitting a fresh 2024 peak at $64,000 on February 28. This substantial 50% climb in the cryptocurrency's value throughout the month has been linked to investor excitement over the upcoming supply cut, which historically triggers a powerful upward trend in prices. The introduction of Bitcoin spot exchange-traded funds (ETFs) into the market, which have seen steady inflows, is also believed to be a significant influence on Bitcoin’s price trajectory. Notably, the Bitcoin ETF $IBIT amassed a record $520 million in a single day, becoming the largest single-day collection for a Bitcoin ETF and attaining $8 billion in assets under management.
While this upward trend is cautiously celebrated, some market experts have flagged potential concerns. These observers postulate that the current market structure of Bitcoin and inflated funding rates may indicate excessive leverage, possibly leading to a liquidation-stimulated adjustment.
Contrarily, options analysts remain optimistic about the price trajectory, dismissing suggestions that the price surge is too rapid. Analyst Chris Newhouse, while discussing the key aspects of Bitcoin’s options markets, open interest, and funding rate, highlighted that the recent rally's characteristics hint at a derivatives-driven move supplemented by steady spot demand due to record ETF inclusions. Breaking past the $53K zone signified robust strength, noteworthy volumes, healthy demand, and momentum traders' increasing participation in the trade.
Independent analyst Nunya Bizniz injected additional confidence into the Bitcoin performance speculation, indicating that Bitcoin's monthly rise was over 70. Bizniz also mentioned that based on past trends, the price maintained an upward movement for nearly 335 days once the RSI exceeded 70.
Currently, Bitcoin sits less than 13% beneath its all-time peak, with both retail and institutional investors projecting that the record $68,900 level could be surpassed before the supply halving, which is projected to occur within the next 52 days. It's essential to note that every investment decision does involve risks, and potential investors are advised to conduct independent research before making any decisions.
Published At
2/28/2024 8:49:00 PM
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