Scattered Clouds
clouds

18 April 2024

Amman

Thursday

71.6 F

22°

Home / Business

'Bitcoin $100K' Was So Near, Yet So Far. What's Next?

27-11-2024 11:10 AM


Ammon News - The "bitcoin $100,000" price milestone has proven elusive. Some analysts are are blaming skittish investors taking profits as companies continue to purchase the crypto asset.

Bitcoin (BTCUSD), the largest cryptocurrency by market cap, rose to an all-time high over $99,500 on Friday. The $100,000 mark seemed imminent. Now, however, it's closer to $92,000.

What happened? And what's next?

Profit-Taking Rammed The Brakes On Bitcoin Rally
Bitcoin's rally picked up steam after Donald Trump's electoral victory, with optimism regarding a more crypto-friendly administration and Congress that could pave the way for regulatory clarity the crypto-industry has been seeking helping to lift bitcoin and other crypto assets.

Still, that rally has slowed lately. Some analysts say that is likely a result of profit-taking by relatively new investors into the asset, with longer-term investors holding on to their bitcoin.

Most of the selling "is coming from 2024 buyers who bought above 56k," said Galaxy Digital CEO Mike Novogratz in an X post Sunday, citing Galaxy's research. "Normal profit taking.

Bitcoin analyst James Check said those who purchased bitcoin around $68,000 six weeks ago are responsible for a large amount of the selling pressure this month.

Investors Pull Money Out Of Bitcoin ETFs
Strong selling was also seen in bitcoin exchange-traded funds (ETFs) on Monday, as the category had its third-largest day of outflows on record at $435.3 million, according to Farside Investors.


This follows the large inflows that seen in these products since Election Day. (BlackRock's iShares Bitcoin Trust (IBIT) saw $267.8 million of inflows on Monday, despite the net outflows for the category as a whole.)

Bitcoin ETFs hold bitcoin and they needed to purchase it as more investors poured money into these products. That's why spot bitcoin ETFs were partially responsible for the cryptocurrency's rise this year.

Where Is Bitcoin Headed?
So far this year, bitcoin prices have more than doubled, gaining roughly 120%. The S&P 500, a broad stock index, has risen about 25%.

Some analysts called for bitcoin to rise above $100,000, though others figured that might not last. Novogratz in a CNBC interview last week said he expected a price correction, though not one that sends bitcoin below $80,000.

The recent weakness comes at a time when more companies are purchasing bitcoin. MicroStrategy (MSTR) announced the purchase of another $5.4 billion worth of bitcoin on Monday morning. Companies such as Marathon Digital (MARA), Semler Scientific (SMLR) and Rumble (RUM) have also committed to purchasing bitcoin.

If that trend continues it could bolster bitcoin prices, according to Coinbase Research.

"We think that these corporate inflows represent an increasingly important source of capital inflow into the space as corporate purchase plans that we think may be relatively more price inelastic," Coinbase researchers wrote in recent commentary.

"This could contribute to continued market momentum in the near term."


Investopedia




No comments

Notice
All comments are reviewed and posted only if approved.
Ammon News reserves the right to delete any comment at any time, and for any reason, and will not publish any comment containing offense or deviating from the subject at hand, or to include the names of any personalities or to stir up sectarian, sectarian or racial strife, hoping to adhere to a high level of the comments as they express The extent of the progress and culture of Ammon News' visitors, noting that the comments are expressed only by the owners.
name : *
email
show email
comment : *
Verification code : Refresh
write code :