- Bitcoin’s sell-side liquidity hits historic lows as whales accumulate, potentially driving prices higher.
- Institutional interest in Bitcoin strengthens with significant inflows observed in spot ETFs, particularly from industry giants.
- Options market reflects bullish sentiment towards Bitcoin, contrasting with concerns over Ethereum’s downside risks.
Bitcoin’s sell-side liquidity has reached historic lows as highlighted by Ki Young Ju, Founder & CEO of CryptoQuant, signaling a significant shift in market dynamics. The Liquid Inventory Ratio, which measures the balance between sell-side inventory and demand from accumulating addresses, has plunged to all-time lows amidst a surge in Bitcoin’s demand.
As per Ali Martinez, an analyst, over the past week alone, Bitcoin whales have scooped up more than 100,000 BTC, amounting to $7 billion investment. This surge in demand, coupled with dwindling sell-side liquidity, has propelled Bitcoin’s price above $70,000, leaving market investors pondering its future direction amid macroeconomic factors and fluctuating ETF inflows.
CryptoQuant’s latest analysis reveals a stark decline in Bitcoin’s sell-side liquidity, with projections suggesting that current levels may only sustain ongoing demand growth for the next year. The imbalance between surging demand and limited sell-side liquidity underscores potential implications for Bitcoin’s price trajectory and market sentiment. Ali Martimez speculated that Bitcoin may be breaking out of an ascending triangle pattern in shorter time frames, with a potential price target of $71,800 if key support levels hold.
Institutional interest in Bitcoin continues to strengthen, with encouraging inflows into Bitcoin spot ETFs observed, particularly from industry giants like Fidelity. Meanwhile, insights from the options market indicate a structurally bullish sentiment towards Bitcoin, contrasting with apprehensions surrounding Ethereum’s downside risks. BTC call options with strike prices surpassing $100,000 and expirations extending to December are in high demand, reflecting investors’ bullish outlook.
Conversely, there’s a notable uptick in the purchase of ETH put options, indicating concerns over potential downside risks for Ethereum, particularly with a strike price of around $2,800 and April expirations. This shift in sentiment is further underscored by ETH risk reversals, which have declined to -5% to the downside, reminiscent of previous market downturns.
