Bitcoin’s price is now above $71,000. Bitcoin has surged 6.5% over the last 24 hour period, rising from $65,500 just to $71,491. A combination of factors has contributed to this remarkable rally. Take a look at four of the main reasons for Bitcoin’s recent price increase.
Futures market influence #1
Bitcoin’s rise in price is largely due to the futures market. According to data Coinglass reports that 64,480 traders have been liquidated in the last 24 hours, totaling $184,000,000. For Bitcoin, the liquidation of shorts valued at $56,9 million, and longs value $16 millions.
Byzantine General, a crypto analyst, noted The significant rise in open interest suggests that leverage is a key factor driving Bitcoin’s higher price. He said, “I can’t help but have the feeling that BTC is trading like someone knows something. A billion $ in open interest got added in the past couple hours. It’s mostly this leverage that pushed us higher I think.”
Furkan Yildirim is another analyst. cautioned About the Sustainability of This Rally, by pointing out that over $1.7 Billion in Open Interest built up from yesterday is an indicator of Overleveraged Positions. “The whole truth is that over $1.7 billion in open interest has been built up since yesterday. We are increasingly seeing the use of overleveraged positions again,” He raised the question of whether the movement would be sustainable.
#2 Bullish News For Bitcoin
The rally has been further boosted by several positive developments. London Stock Exchange’s (LSE) announcement that they will introduce a Bitcoin exchange traded notes market (ETNs), as well as Ether ETNs (ETH), by May 28, was notable. The decision is a step in the right direction for professional investors and signals the increasing acceptance of Bitcoin by institutions.
The news about Peruvian Nilam Resources expressing intent Buy 24,800 Bitcoins for $1.7 Billion “at a discounted rate relative to current market prices” MindWave is a special-purpose entity that has been involved in an acquisition strategy. This acquired strategy, coupled with Nilam’s status as a microcap OTC, have injected both excitement and skepticism to the market.
#3 Bitcoin ETFs And Coinbase Premium
The dynamics of Bitcoin ETFs, and their impact on the price of Bitcoin was another critical factor. Coinbase premium. CryptoQuant analyst Maartunn noted that the Coinbase Premium Gap had turned positive yesterday. This indicates a strong demand for Bitcoin spot ETFs.
Who’s coming back? Bitcoin Premium Gap: Positive again
https://t.co/0C7YyyFe2T pic.twitter.com/b73XbSygbl— Maartunn (@JA_Maartun) March 25, 2024
Given Coinbase’s custodianship of approximately 90% The premium on Bitcoin ETF assets is a key indicator for institutional demand. The positive ETF inflows of $15.4 million yesterday after five days straight of net outflows last week, further proves this.
Grayscale’s GBTC During the week, outflows of $350 millions were recorded. Fidelity FBTC, on the other hand, started to make up for last week’s slack by bringing in $261.8 inflows. Blackrock also had a weak day, with inflows of only $35 millions. Coinbase’s premium was a reliable indicator once more.
The ETF flow yesterday was positive after the negative $15.4 million of last week.$GBTC Outflows totaled $350 Million. Inflows of $261.8million by Fidelity helped to make up for the loss last week.
Blackrock did only $35 million.Price increased from $65k up to over $70k. A day… pic.twitter.com/HCNwa7L2p8
— WhalePanda (@WhalePanda) March 26, 2024
Fourth Technical Breakout
A technical point of view, Bitcoin’s breakout price from the parallel trend channel that descends on the chart for 4 hours marked a pivotal turning point. A successful retest in the resistance zone has validated the legitimacy of the breakout, which led to an increase of more than 7% in the price. Technical movement has increased the confidence among traders and investors, which in turn has contributed to the surge that took Bitcoin’s price over the $70,000 barrier.
Featured image created with DALL·E, chart from TradingView.com
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