Day: January 6, 2025

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Bitcoin’s price has surged past the $100,000 mark once again, marking a significant milestone in the ongoing Bitcoin rally. With renewed investor optimism, U.S. regulatory reforms under President-elect Donald Trump, and the continued influx of funds into Bitcoin exchange-traded funds (ETFs), many believe the crypto market’s momentum will carry into 2025. However, questions remain about the sustainability of this bull run.

Bitcoin Surpasses $100,000 Amid Renewed Risk Appetite

On Monday, Bitcoin (BTCUSD) climbed 4.1%, reaching $102,504. This marks its highest weekly gain since November 2024, according to Bloomberg data.

The Bitcoin rally experienced a brief slowdown in December 2024 as investors took profits following a record-breaking run. However, optimism has returned with expectations that a pro-crypto White House will create favorable conditions for digital assets in the U.S.

Khushboo Khullar, venture partner at Lightning Ventures, highlighted the potential for a “super cycle” in 2025, driven by regulatory reforms under the Trump administration.

ETF Inflows and Premium Metrics Signal Strong Demand

One of the key drivers of the recent Bitcoin rally is the surge in inflows into U.S.-based Bitcoin ETFs. Investors poured $908 million into Bitcoin ETFs last Friday, marking the fifth-largest inflow since their launch in January 2024. This followed a record net outflow of $680 million on December 19.

Another bullish signal for Bitcoin is the recovery of the Bitcoin Coinbase Premium. This metric, which tracks the difference between Bitcoin prices on Coinbase Global Inc. (NASDAQ:COIN) and Binance Holdings Ltd., indicates stronger demand from U.S. investors.

Joe McCann, CEO of Miami-based crypto hedge fund Asymmetric, explained that ETF issuers primarily trade and custody their assets with Coinbase, influencing the premium based on demand.

MicroStrategy’s Continued Bitcoin Purchases Boost Market Sentiment

MicroStrategy Inc. (NASDAQ:MSTR), a software company that has become a Bitcoin proxy, remains a significant player in the ongoing Bitcoin rally. The company recently purchased an additional $101 million worth of Bitcoin, marking its ninth consecutive week of acquisitions.

While this is a sizable investment, it represents a decline from the over $1 billion in Bitcoin purchases made by MicroStrategy in November and December 2024.

The company’s Bitcoin-focused strategy has been a key factor in driving institutional adoption of the cryptocurrency. Led by Executive Chairman Michael Saylor, MicroStrategy’s Bitcoin holdings have consistently grown, with the company now holding over 160,000 BTC.

Regulatory Optimism Underpins Bitcoin’s Prospects in 2025

A major factor contributing to the current Bitcoin rally is the anticipation of favorable regulatory policies from the incoming Trump administration. President-elect Trump has made several pro-crypto pledges, including the creation of a national Bitcoin reserve.

This regulatory optimism has fueled hopes that the U.S. will lead the charge in adopting Bitcoin-friendly policies, encouraging both institutional and retail investors to increase their holdings.

However, the sustainability of this rally will depend on whether these pledges materialize.

Market Caution: Could Bitcoin Face a Correction in 2025?

Despite the bullish sentiment, some analysts are cautious about the longevity of the Bitcoin rally. In a recent MLIV Pulse survey, 39% of respondents identified Bitcoin as the winning investment of 2024 most likely to turn into a loser in 2025.

This skepticism is rooted in the volatility of the crypto market. While Bitcoin has demonstrated resilience and growth, it remains susceptible to sudden downturns due to regulatory shifts, economic instability, or unexpected market events.

What’s Next for Bitcoin in 2025?

The future of the Bitcoin rally will largely hinge on several key factors:

U.S. Regulatory Policies: The extent to which the Trump administration delivers on its crypto promises will play a crucial role in shaping Bitcoin’s performance.

Institutional Adoption: Continued investment from institutional players like MicroStrategy (NASDAQ:MSTR) and Coinbase (NASDAQ:COIN) will drive demand and influence market sentiment.

Global Economic Conditions: Macroeconomic trends, including inflation and interest rate changes, will impact investor behavior and the broader crypto market.

While Bitcoin’s rise past $100,000 marks a significant milestone, the coming months will reveal whether this is a sustainable bull run or a temporary surge. Investors should stay vigilant, keeping an eye on regulatory developments and market signals to navigate the unpredictable crypto landscape in 2025.

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The cryptocurrency market has been on a strong upward trajectory since early 2023. According to data from CryptoQuant, the crypto bull market is entering its final stages, raising questions about what lies ahead for Bitcoin (BTC) and Ethereum (ETH). With Bitcoin recently surpassing $100,000 and Ethereum breaking past $3,500, investors are wondering if there’s more room for growth or if it’s time to exercise caution.

Here’s a closer look at what analysts and industry insiders are saying about the crypto market’s future.

CryptoQuant Warns: Final Stage of Crypto Bull Market Is Here

Data analytics provider CryptoQuant recently published a report suggesting that the crypto bull market is nearing its cyclical peak. The firm warns that Bitcoin’s recent spike to $101,812 resembles patterns seen during previous market tops.

In a January 6 post, CryptoQuant contributor “Crypto Dan” stated, “With a substantial influx of new investments as well as additional funds from existing investors, it is reasonable to expect that the market is now in the latter stages of this cycle.”

According to the report, one critical metric—Bitcoin’s short-term holding percentage—jumped to 36% in Q4 2024. Historically, a high percentage of recently purchased Bitcoin indicates that investors are becoming more speculative, a sign that the bull market is reaching its end.

While CryptoQuant acknowledges that Bitcoin and altcoins could see further gains in 2025, they urge investors to be cautious. “From a conservative standpoint and with risk management in mind, caution is advised,” the post concluded.

Other Analysts Predict the Bull Run Will Continue in 2025

Despite CryptoQuant’s cautious outlook, other analysts believe the crypto bull market has more room to grow.

Asset management firm VanEck expects Bitcoin (BTCUSD) to hit a medium-term peak of $180,000 in early 2025. They also project Ethereum (ETHUSD) to trade above $6,000 by the end of the year.

According to Matthew Sigel, head of digital asset research at VanEck, “At the cycle’s apex, we project Bitcoin to be valued at around $180,000, with Ethereum trading above $6,000.”

Steno Research echoes this sentiment, predicting that 2025 could be crypto’s best year yet. They foresee Bitcoin and Ethereum surpassing their previous all-time highs as more institutional investors enter the market.

Traders on popular prediction platforms Polymarket and Kalshi also expect BTC and ETH to reach new heights in 2025. They believe regulatory developments, such as the approval of new crypto exchange-traded funds (ETFs) and the establishment of a U.S. Bitcoin reserve, could further boost the market.

What’s Driving the Crypto Bull Market?

Several factors have fueled the current crypto bull market:

Institutional Adoption

More institutional investors are embracing cryptocurrencies, driven by increasing regulatory clarity and new financial products like ETFs.

Macro Economic Trends

Global inflation and economic uncertainty have pushed investors toward Bitcoin as a hedge against traditional financial risks.

Halving Events

Bitcoin’s next halving event is expected in early 2024, reducing the block reward for miners. Historically, halving events have preceded significant bull runs.

Emerging Markets

Cryptocurrencies are becoming more popular in emerging markets, where traditional banking systems are less accessible.

Should Investors Be Cautious or Optimistic?

The key question for investors is whether the crypto bull market is closer to its peak or if it still has more upside.

CryptoQuant’s warning suggests that we could be nearing the top of the cycle. Their data indicates that speculative behavior is increasing, which often precedes market corrections.

However, many analysts remain bullish, pointing to Bitcoin’s strong fundamentals and growing adoption.

VanEck, Steno Research, and traders on Polymarket believe that Bitcoin and Ethereum will continue to rise throughout 2025, driven by increased institutional interest and favorable regulatory developments.

The Bottom Line: Is the Crypto Bull Market Ending?

While there are signs that the crypto bull market is entering its later stages, the outlook remains divided. Some analysts urge caution, warning that speculative behavior could trigger a market correction. Others remain optimistic, forecasting new all-time highs for Bitcoin (BTCUSD) and Ethereum (ETHUSD) in 2025.

As always, investors should approach the market with a balanced strategy, considering both the risks and potential rewards. Whether the bull run continues or a correction looms, the crypto market is likely to remain a hot topic throughout 2025.

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DUBAI, UAE, Jan. 3, 2025 /PRNewswire/ — Bybit, the world’s second-largest cryptocurrency exchange by trading volume, has released its latest crypto derivatives analytics report in collaboration with Block Scholes. The report sheds light on key trends in open interest and market behavior during the significant year-end options expiration for Bitcoin (BTC) and Ethereum (ETH).

Key highlights:

Open Interest Solid Amid Year-End Options Expiration

Although open interest in BTC and ETH perpetual swaps has not returned to the early December 2024 highs, it remained stable during the critical year-end options expiration. This stability suggests that traders did not heavily rely on perpetual contracts to hedge the delta of expiring options, which contributed to the muted volatility observed during this period. Trading volumes dipped during the winter holiday season, aligning with a collapse in realized volatility, which reached its lowest levels of December.

BTC Option Curve Remains Steep During Call-Put Parity

Contrary to expectations, the expiration of December’s options did not spark a surge in volatility. Instead, realized volatility declined to the lower end of its recent range. The implied volatility term structure for BTC options remains steep, with longer-dated implied volatility hovering around 57% and 1-week at-the-money options trading approximately five points lower. Most of the expired open interest has not been reinvested, maintaining a neutral call-put balance. As a result, BTC’s options market shows limited leverage compared to its position at the beginning of December 2024, reflecting a cautious sentiment.

Huge ETH Option Expiring Doesn’t Cause Volatility

Despite the substantial expiration of ETH options in late December 2024, market dynamics remained stable. A spike in realized volatility during December failed to extend into the new year, with ETH’s spot price currently showing lower volatility compared to short-tenor implied volatility. Over the past week, the implied volatility term structure for ETH options has shifted, steepening briefly before flattening again, diverging from BTC’s consistently steep profile. This pattern suggests that ETH’s options market is bracing for potential short-term volatility in spot price movements.

Interestingly, despite the expiration, call options for ETH have gained momentum at the start of 2025, dominating the market and indicating an optimistic outlook among traders.

Access the Full Report:

Gain deeper insights and explore the potential impacts on your crypto trading strategies by downloading the full Bybit x Block Scholes Crypto Derivatives Analytics Report.

#Bybit / #TheCryptoArk / #BybitLearn / #BybitResearch / #BTC100K

About Bybit

Bybit is the world’s second-largest cryptocurrency exchange by trading volume, serving a global community of over 60 million users. Founded in 2018, Bybit is redefining openness in the decentralized world by creating a simpler, open and equal ecosystem for everyone. With a strong focus on Web3, Bybit partners strategically with leading blockchain protocols to provide robust infrastructure and drive on-chain innovation. Renowned for its secure custody, diverse marketplaces, intuitive user experience, and advanced blockchain tools, Bybit bridges the gap between TradFi and DeFi, empowering builders, creators, and enthusiasts to unlock the full potential of Web3. Discover the future of decentralized finance at Bybit.com.

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