Bitcoin’s current rally seems relatively unhindered, with the largest cryptocurrency experiencing consecutive days of growth, edging closer to its peak. This surge is largely attributed to the robust demand expected from exchange-traded funds (ETFs) at the week’s outset.
Reaching heights not seen since November 2021, Bitcoin soared to $66,500, marking a 6.34% increase. Its year-to-date surge of approximately 55% surpasses gains seen in traditional asset classes like stocks by a significant margin.
Jaime Baeza, founder of crypto hedge fund AnB Investments, noted the similarities between the current market conditions and the bull run of late 2020 and 2021, emphasizing heightened levels of leverage and greed. The frenzy surrounding Bitcoin is fueled by the seemingly insatiable demand from US-listed Bitcoin ETFs, which have seen massive inflows totaling $7.35 billion since their launch, despite notable outflows from firms like Grayscale Bitcoin Trust.
With anticipation of continued ETF inflows and the impending Bitcoin halving in April, traders are optimistic about Bitcoin’s potential to surpass its previous record of nearly $69,000. This optimism extends to altcoins like Cardano and Solana, which saw gains of 6.8% and 3.3% respectively. Additionally, meme coins, including Dogecoin and Shiba Inu, experienced significant increases, reminiscent of the 2021 bull run.
Caroline Mauron, co-founder of digital-asset derivatives liquidity provider Orbit Markets, likened the current situation to retail traders seeking quick profits from volatile tokens. Meanwhile, trading in crypto derivatives, particularly at Chicago-based CME Group’s Bitcoin and Ether futures market, indicates a bullish sentiment among US institutions, with all-time highs for Bitcoin expected to be tested in the short term.
