Recently, Bitcoin hit another more than two-year high due to the recent surge in ETF inflows, and options traders have been betting on new all-time highs to come.
On the fifth day of the Chinese Lunar New Year, the cryptocurrency market continues to usher in the Spring Festival. According to Coingecko, with the launch of Bitcoin and Ethereum, the market capitalization of Bitcoin has once again exceeded $1 trillion, while the total market capitalization of cryptocurrencies has also exceeded $2 trillion.
Bitcoin** broke through the $51,000 level per coin and once again hit a new high since December 2021. Since the beginning of February this year, the world's largest cryptocurrency has been around 20%, reaching its biggest monthly gain since October last year.
Other cryptocurrencies are also trending. According to Coindesk, Ethereum touched $2,759 per coin on Wednesday$93, which is the highest level since May 2022. Investors expect the U.S. Securities and Exchange Commission (SEC) to also be on track to approve spot Ethereum ETFs this year.
Analysts said that in recent weeks, newly listed US spot bitcoin ETFs have attracted a large amount of capital inflows, driving some of the ** trends. According to LSEG Lipper, inflows into 11 spot Bitcoin ETFs in the U.S. increased to 16$400 million. The ETFs began trading in January after receiving regulatory approvals.
Cryptocurrency liquidity raised.
"It remains to be seen whether the pace of inflows will continue, but in the crypto space, ** tends to drive money flows," said analysts at provider B2C2. ”
The options market shows that investors are stepping up their bets that Bitcoin will hit another all-time high. According to Deribit, the largest crypto options exchange, there was a significant increase in the number of open interest of $60,000, $65,000 and $75,000 for call options expiring on March 29, respectively.
Bitcoin options traders are betting that Bitcoin will hit an all-time high. Vetle Lunde, senior analyst at K33 Research, said: "The options market as a whole is currently preparing for Bitcoin to continue its growth momentum in the coming months. ”
Chris Newhouse, a DeFi analyst at Cumberland Labs, noted: "Options trading with strikes in the 75,000-100,000 range are likely to be more of a bet on longer-term implied volatility than a pure direction bet." ”
The Fed's potential rate cut and Bitcoin halving event could be one of the main drivers pushing Bitcoin higher**. Bitcoin halving events occur every four years, and a 4th halving event is expected to be triggered at the end of April 2024. When the halving happens, the rewards given to Bitcoin miners will be cut in half, which will reduce the amount of Bitcoin on the market.
Historically, halving events have typically propelled Bitcoin to new highs in the following months. The last time Bitcoin hit an all-time high was in November 2021, when it was just below $69,000.