In just a few days, the total cryptocurrency market cap has jumped by over $200 billion, mainly driven by Bitcoin’s (BTC) impressive rise above $67,000. Both Bitcoin and Ethereum have seen price increases of over 10% in the past week, currently trading at about $67,300 and $2,618, respectively.
This surge has energized the meme coin market, especially with Dogecoin (DOGE) leading the way, indicating a growing interest from speculative traders. Moreover, more than 95% of Bitcoin addresses are now in profit.
As the market heats up, everyone is scrambling to understand the factors driving this bullish momentum. Let’s explore together.
The recent drop in fears of further crypto capitulation has led to a rise in FOMO (Fear of Missing Out) trading within the crypto community. Bitcoin’s fear and greed index has surged to 73%, showing that traders are increasingly driven by greed.
Market data from CoinGlass reveals that Bitcoin’s Open Interest (OI) has reached an all-time high of around $40 billion. This significant increase in OI could signal upcoming volatility in the cryptocurrency market.
On-chain data analysis from CryptoQuant shows that new Bitcoin whale investors now hold about 1.97 million BTC, marking an impressive 800% increase year-to-date. Similarly, analytics firm Santiment reported a surge in whale transactions, with 11,697 transfers of at least $100,000 recorded on Tuesday—the highest in over ten weeks.
This increase has led to Bitcoin supplies on centralized exchanges gradually falling to a five-year low.
ETF Purchases Signal Confidence
Notably, the US-based spot Bitcoin ETFs have purchased coins worth over $1.5 billion in the past four days. Led by BlackRock’s IBIT, the US spot Bitcoin ETFs registered a net cash inflow of around $458 million on Wednesday.
From historical data, Bitcoin price has performed well in the fourth quarter. Coupled with the upcoming 2024 US elections and the expected Fed rate cuts amid a shifting global economic outlook, the crypto market will likely continue in bullish sentiment.
In the coming months, the cryptocurrency market is likely to follow the positive trends of gold and major stock indices, supported by a confident outlook.
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