In an exciting turn of events, Bitcoin has reached a new record by successfully surpassing the long-awaited $70,000 mark. This achievement comes after a four-month struggle to regain this threshold. But Bitcoin’s accomplishments don’t end there. It is now making swift progress towards its all-time high, reaching an intraday peak of $71,475 and maintaining its gains. With that, Bitcoin is only 3.5% away from its peak of $73,750.
The effects of Bitcoin’s rally have been felt across the entire cryptocurrency market. In the past day alone, the global market has experienced a 4.56% increase, bringing its total value to $2.4 trillion. This surge in value is a result of approximately $112.08 billion entering the market within the last 24 hours. Furthermore, market volume has seen a significant surge of 89.41%, now standing at $100.99 billion.
This unexpected development has prompted market participants to examine the factors behind this turnaround. According to analytics platform CryptoQuant, the uptrend in Bitcoin can be attributed to massive trading activity, particularly from Binance whales, which are large traders on the Binance exchange.
CryptoQuant’s market watcher, Mignolet, highlighted in an analysis today that Binance whales have been actively participating in the market during Asian trading hours since October 14th. This activity has had an impact on the Coinbase Premium Gap (CPG) data, which tracks price differences between Coinbase and Binance, two prominent exchanges for U.S. and international traders. As of now, the CPG is declining despite Bitcoin’s price increase, indicating a “negative premium.”
Mignolet warns against interpreting this as a decrease in U.S. demand. In fact, since October 14th, there has been a significant inflow of Bitcoin into U.S. Bitcoin spot ETFs, totaling approximately 47,000 Bitcoin or roughly $3.34 billion given Bitcoin’s current market value above $71,000. Additionally, recent inflows into U.S. Bitcoin ETFs have reached a six-month high, as reported by The Crypto Basic last week.
Mignolet further explains that CPG data closely aligns with ETF demand, as most ETF products utilize Coinbase. Normally, high U.S. demand would drive the CPG to a positive value, but the negative premium suggests that Binance whales are playing a crucial role in driving Bitcoin’s price. However, it is important to note that U.S. demand remains strong, even if it isn’t fully reflected in Coinbase prices.
In essence, the current price of Bitcoin is primarily influenced by Binance whales, with strong support from steady U.S. capital inflows. It is important to remember that this article is for informational purposes only and should not be considered financial advice. Readers are advised to conduct thorough research before making any investment decisions.