(Kitco News) – Another day, another all-time high for Bitcoin (BTC) as King Crypto continued to push into price discovery territory, with bulls only a stone’s throw away from reaching $100,000.
Data provided by TradingView shows that BTC hit a new record high of $98,372 overnight before profit-taking dropped it back down to support $96,000.
BTC/USD Chart by TradingView
Bitcoin’s latest record-setting rally follows the launch of options on several spot BTC exchange-traded funds (ETFs), which hit a volume of $1.9 billion on their first day of trading and continue to see heavy demand.
“The introduction of options for BlackRock’s and Grayscale’s Bitcoin ETFs is a major milestone in the crypto market’s maturation and legitimization as a new nascent asset class,” said Jag Kooner, Head of Derivatives at Bitfinex. “These products allow for advanced trading strategies like hedging, income generation, and better risk management for TradFi investors, which in turn attract a broader spectrum of institutional and retail investors.”
“The impact is twofold: firstly, it deepens market liquidity and stability by enabling more efficient price discovery,” he added. “Secondly, it reduces volatility on the higher timeframes which opens the door for Bitcoin as a reserve asset for companies/countries and fulfills the necessary attributes for the ‘digital gold’ narrative.”
The cryptocurrency community is now squarely focused on Bitcoin hitting the long sought-after $100,000 price point, with most saying it is now a when, not if, scenario.
“BTC has recently set new highs continuously this week, breaking through $98,000 today and being just one pump away from $100,000,” said Gracy Chen, CEO of Bitget. “Whether BTC can break through $100,000 and whether there will be a pullback after the breakout is something we view as follows.”
Looking at institutional dominance, Chen noted that “The main driver behind BTC's rapid rise is still institutional involvement. We have seen large net inflows into BTC ETFs this week. By Wednesday this week, BTC ETFs had achieved a net inflow of $1.8 billion.”
“MicroStrategy purchased 51,000 BTC last week at a cost of $88,617 each, and this week, they announced plans to raise $2.6 billion to continue purchasing BTC,” she added. “Well-known mining companies are planning to issue $850 million in convertible bonds to buy BTC. The massive spot buying power of traditional funds has caused BTC’s price to rise quickly.”
Regarding derivatives, Chen highlighted that “The open interest in BTC contracts has surged to $63 billion, with a daily increase of $6 billion, attracting significant hot money into the market.”
“BTC's implied volatility (IV) has risen to 60, indicating a higher probability of large market fluctuations in the future,” she added. “Short-term capital has a tendency to lock in profits, which could lead to large price swings around the $100K mark.”
As for $100,000 acting as a major barrier, Chen said the price level “could act as a psychological barrier where investors might reassess their positions, leading to a natural sell-off point, as seen in other asset classes when significant round numbers are breached.”
“Therefore, we believe that if BTC breaks through $100K, there is a high probability of a pullback,” she concluded. “However, the entry of long-term institutional funds suggests that BTC's price is far from this point, and a breakout above $100K and further upward movement is only a matter of time.”
At the time of writing, Bitcoin trades at $97,020 for a gain of 3.18% on the 24-hour chart.
