Bitcoin New All-Time High: Check – What’s Next The Leading Crypto Asset
Bitcoin’s latest rally to a new all-time high close to $67,000 has kicked-off a new wave of bullish predictions, with BTC price already sitting more than double from beginning of the year.
The Bitcoin blockchain is only 12 years old, and traders in digital markets and Wall Street traders could not be more interested BTC’s price movements. The price currently sitting at unprecedented levels, analysts are adjusting their models and scrutinizing charts to predict where it will go next.
In October alone, bitcoin’s price has rallied more than 50% – a move largely fueled by U.S. regulators’ first approval of an exchange-traded fund (ETFs) linked to bitcoin futures contracts. The ProShares Bitcoin Strategy ETF started trading on Tuesday on the New York Stock Exchange (NYSE) under the ticker BITO and hauled in $570 million of assets on its first day, while reaching a whopping $1 billion in trading volume, in one of the most successful ETF launches of all time.
Bitcoin’s previous all-time high was $64,889, recorded back in April this year. Since then, market prognosticators saw that mark as the price to beat. Now, with fewer readily available signposts, the outlook might be harder to gauge.
What the analysts are saying
Not everyone is bullish. According to some analysts bitcoin will find further gains past the $60,000 mark tougher to come by.
According to Damanick Dantes, $86,000 might represent the next key price target for bulls, based on a reading of price-chart signals. He said:
“All eyes are set on the $100K mark, but when retail does rush in and more funds open up to bitcoin, including physically backed ETFs, $100K is unlikely to be the end of it.”
Matthew Dibb, COO of Stack Funds:
Since the launch of ProShares’ ETF, there has been a large influx of retail participation. Funding rates for the futures market – a gauge of how willing investors are to pay up for leveraged bets – are rising, but not at the high levels seen earlier in the year. Dibb said:
”Our next target on spot BTC is $80,000 in the short term.”
As the market gains further confidence in the medium term, he said, some capital rotation is to be expected from bitcoin into ether, the native cryptocurrency of the Ethereum blockchain, and other alternative digital assets.
Ulrik Lykke, founder of ARK36:
“I wouldn’t be surprised if we see bitcoin climb towards $100,000 during Q4 of 2021 or Q1 of 2022.”
Juan Pellicer, a research analyst at IntoTheBlock:
“This growth is a phenomenal proxy of the institutional clients that have been adopting bitcoin.”
Samuel Indyk, an analyst at Investing.com:
As has been the case in the past when major events in the cryptocurrency market occur, a correction could be on the cards:
“For example, when the bitcoin futures contract launched on the Chicago Mercantile Exchange (CME) in 2017, a bear market occurred shortly after, and it took almost three years for the price to recover.”
Edward Moya, Senior Market Analyst at Oanda:
One risk is that soaring oil and natural gas prices might lead to extra scrutiny over the Bitcoin network’s energy usage. That’s especially the case as winter approaches in the Northern Hemisphere. He warned:
“Governments might take harsh stances if this winter leads to shortfalls in energy across several countries and that could mess with the hashrate.”
Bitcoin Open Interest Rising
Bitcoin has also seen a marked increase in open interest in the month of October. Mirroring the growth of the asset in the month, open interest has grown 23% in the month of October alone. This represents the fastest 18-day increase in global open interest and a 7-month high. Bitcoin has led the global open interest as it has recorded the most growth in this regard.
The previous week saw the global open interest denominated in bitcoin sitting at 350,000 BTC. This week though, that number has climbed to 370,000, returning to levels witnessed in April during the height of the last bull market.
Bitcoin Futures Contracts on CME have been the biggest push behind the open interest growth. This, too, has reached a new record as the amount held in Futures Contracts now total approximately $4 billion.
Binance has also seen open interest set new records on the platform. The trading exchange now has $5.3 billion in bitcoin-denominated open interest, marking a new all-time high on Binance.
The return of open interest usually spells good news for the market. Then again, this could be just another metric that ends up not affecting the value of bitcoin in any significant way. Open interest means that investors are back putting money in an asset, which has been a driver of value for the digital asset in the past and could very well cause the same movement in the asset again.
However, it is important to note that open interest can rise and fall as it follows the creation of futures contracts. These contracts can be created in both bull and bear markets, leading to an increase in open interest but not necessarily an increase in price.
