Bitcoin continues its push towards record highs, reaching $94,000 yesterday. Despite some minor slowdowns, Bitcoin dominance remains above 60%, signaling continued investor confidence in the leading cryptocurrency.
ETF Inflows Show Unwavering Institutional Demand
Funds are pouring into Bitcoin ETFs, particularly BlackRock’s IBIT ETF, which now holds nearly $30 billion in total investments, according to Farside. The fund's net asset value (NAV) has climbed to $44 billion, meaning investors have collectively earned approximately $14 billion in profits—a +47% absolute performance on average.
IBIT has also made its mark among the top 50 ETFs by AUM and ranks in the top 5 for daily trading volume among the top 100 ETFs.
Trump-Driven Market Optimism Continues
Bitcoin’s rally is partly fueled by the so-called "Trump rally." Markets have responded positively to reports that Teresa Goody Guillen—a former SEC lawyer now representing clients against the SEC—could replace Gary Gensler as SEC Chair. In addition, Cantor Fitzgerald CEO Howard Lutnick, a strong crypto supporter, is reportedly being considered for the role of Commerce Secretary.
Stablecoin Reserves Indicate Strong Buying Power
On-chain data suggests strong buying power remains in the market:
Stablecoin reserves on exchanges remain high, which typically signals increased buying potential.
CryptoQuant reported a 1.5 billion US dollar net inflow of stablecoins into exchanges two days ago, suggesting more funds are waiting to enter the crypto market.
Derivatives Market Sees Record Open Interest
The Bitcoin futures open interest (OI) in USD has hit new all-time highs, while OI in BTC terms is approaching its October 2022 peak of 667,000 BTC, now standing at 622,000 BTC worth of contracts.
Meanwhile, options on BlackRock’s IBIT ETF began trading yesterday, with impressive results:
Nearly 354,000 contracts were traded, including 289,000 call options, indicating strong bullish sentiment.
Bloomberg Intelligence reports that traders built nearly $2 billion in notional exposure on the first day.
Key strike price concentrations are forming around $60, $65, and $100, while the current IBIT ETF price remains below $53.
With this level of leverage in the market, any sharp price movement could trigger liquidations and accelerate volatility, especially if Bitcoin approaches the psychologically significant $100,000 level.
Macroeconomic Factors to Watch
Geopolitical tensions triggered the only slight correction this week and could continue to weigh on market sentiment.
NVIDIA earnings (released tonight) could impact broader market sentiment, especially given the company’s near all-time-high stock price.
The US economic outlook remains solid, with GDP growth at 2.5% and inflation largely under control. However, risks remain, including debt ceiling negotiations in early 2025 and ongoing geopolitical uncertainties.
Final Thoughts
Bitcoin’s price action remains highly leveraged, with strong institutional inflows, ETF-driven speculation, and political tailwinds supporting the rally. However, geopolitical risks and macroeconomic factors could still introduce volatility.
With stablecoin reserves high and derivatives markets heating up, all eyes are now on whether Bitcoin can break through the $100,000 resistance level—which could mark the beginning of an even more explosive phase of the bull market.