bitcoin shows no signs of slowing down in the short term, as bitcoin-performance/#:~:text=The%20altcoin%20season%20index%20currently,season%20is%20in%20full%20swing.&text=Disclaimer%3A%20The%20article%20is%20provided%20for%20educational%20purposes%20only.” rel=”nofollow noopener” target=”_blank”>flagship crypto token rose above $57,000 on February 27, the first time since 2021. This price increase is likely due to several recent developments That certainly provides a bullish narrative for btc.
bitcoin demand is skyrocketing
Eric Balchunas, Bloomberg analyst revealed in a post on X (formerly Twitter) that the new nine bitcoin spot ETFs (excluding Grayscale's GBTC) set a new all-time trading volume record with $2.4 billion traded on February 26. This is significant since it shows the bitcoin/institutional-buyers-of-bitcoin/” rel=”nofollow noopener” target=”_blank”>Increased demand for the flagship crypto of institutional investors.
Due to the interest in these bitcoin ETFs, fund issuers have continued to accumulate a significant amount of bitcoin. Curiously, as revealed by Bloomberg analyst James SeyffartThese issuers had to purchase over $403 million worth of btc due to the historic trading volume recorded on February 26.
These bitcoin ETF Issuers They are not the only institutional investors who have accumulated a large amount of btc lately. Bitcoinist recently reported that MicroStrategy bought 3,000 btc this month, increasing its holdings to 193,000 btc.
These purchases further highlight the general sentiment among bitcoin/bitcoin-whales-buying-spree/” rel=”nofollow noopener” target=”_blank”>btc whales which have continued to accumulate, even when the price of bitcoin experienced a downward trend following the approval of the Spot btc ETFs. Meanwhile, btc News bitcoin/bitcoin-demands-exceeds-supply/” rel=”nofollow noopener” target=”_blank”>recently reported how btc supply is catching up with demand, another factor that is driving up the price of btc.
The long awaited bitcoin Halving is also getting closer, another factor that has continued to contribute to the market's bullish momentum. This event will further slow the rate at which btc enters circulation, which could lead to a significant upward movement in the price of btc, especially if demand for the flagship cryptocurrency continues at this pace.
The derivatives market also contributes to the rise in btc prices
There has been an increase in commercial activity in the derivatives market lately, with data from CoinGlass showing how open interest has continued to increase. This rise indicates that new money is flowing into the bitcoin ecosystem, with many traders placing bullish leveraged bets on btc.
This conclusion can also be reached when considering the number of bitcoin shorts liquidated in the last 24 hours. Data from Coinglass shows that traders betting on btc falling have lost $270 million in this period. As such, it is more than likely that those causing the rise in open interest are likely the bulls and not the bears.
The derivatives market is believed to be integral to btc price discovery. CEO of CryptoQuant once noticed that “bitcoin is in a futures-driven market”, which is less affected by trading activity in the Spot market.
At the time of writing, btc was trading at around $56,100, up more than 8% in the last 24 hours, according to bitcoin/” rel=”nofollow noopener” target=”_blank”>data from CoinMarketCap.
<img decoding="async" class="aligncenter size-medium" src="https://technicalterrence.com/wp-content/uploads/2024/02/Why-did-Bitcoin-price-rise-above-57000-today" alt="Tradingview.com bitcoin Price Chart” width=”3286″ height=”1530″/>
btc readies to test $56,500 resistance | Source: BTCUSD on Tradingview.com
Featured image from U.Today, chart from Tradingview.com
