Bitcoin (BTC) surged to a new all-time high on Sunday, breaking above $125,000 to $125,559 before losing momentum and settling at $123,520. Bullish sentiment around the flagship cryptocurrency intensified over the weekend after spot Bitcoin ETFs registered their second-best week on record, and exchange Meanwhile, Bitcoin reserves fell to a six-year low, indicating investors were preparing to hold their assets for the long term, which is often interpreted as a bullish sign. The flagship cryptocurrency is up almost 1% during the ongoing session, trading around $124,345. Crypto ETPs Post Record $5.95 Billion In Inflows Cryptocurrency investment products recorded their highest-ever inflows last week as the government shutdown fueled a rally in the spot markets. According to data from CoinShares, global crypto exchange-traded products (ETPs) registered a staggering $5.95 billion in inflows for the week ending Friday. James Butterfill, CoinShares' head of research, stated, “We believe this was due to a delayed response to the FOMC [Federal Open Market Committee] interest rate cut, compounded by very weak employment data [...], and concerns over US government stability following the shutdown.” US-listed Bitcoin ETFs registered $3.2 billion in inflows last week, the second-largest weekly inflows since their launch in January 2024. The jump was due to renewed investor interest as prices reached record highs. According to data from SoSoValue, only the week ending November 22, 2024, registered higher inflows. The recovery reversed the previous week’s $902 million in outflows. As expected, BlackRock’s iShares Bitcoin Trust (IBIT) dominated the inflows with $1.8 billion, followed by Fidelity’s FBTC with $692 million. Analysts have attributed the return of positive sentiment to growing expectations of a rate cut, which has improved sentiment towards risk assets. Iliya Kalchev, analyst at Nexo, stated, “Growing expectations of another US interest rate cut triggered a “shift in sentiment,” attracting renewed investor demand for Bitcoin ETFs. At current run-rates, Q4 flows could retire over 100,000 BTC from circulation — more than double new issuance. ETF absorption is accelerating while long-term holder distribution eases, helping BTC build a stronger base,” near key technical support levels.” Bitcoin Rally Fueled By Government Shutdown, Macro Factors Analysts stated that Bitcoin’s (BTC) rally was fueled by several macroeconomic factors, including the US government shutdown, which helped Bitcoin reinforce its reputation as a store of value. Similar conditions in the past have led to price milestones as well. Fabian Dori, chief investment officer at Sygnum Bank, stated, “The US government shutdown has renewed discussion around Bitcoin’s store-of-value role, as political dysfunction underscores interest in decentralised assets. At the same time, the broader environment — characterised by loose liquidity conditions, a service-led acceleration in the business cycle, and narrowing underperformance relative to equities and gold — has drawn attention to digital assets.” Bitcoin “Debasement Trade” Gathers Steam Analysts are bullish about Bitcoin’s trajectory and have focused on the presence of strong institutional interest. According to Caleb Franzen, creator of Cubic Analytics, the absence of a strong price pullback indicated sizable investor demand. “When I see short-term price action like this, with minimal pullbacks and large spikes to the upside followed by sustained bids, I see institutions.” Meanwhile, mainstream finance experts referred to Bitcoin’s position in the “debasement trade.” Debasement trade refers to investors wanting to hedge against the declining values of fiat currencies. “Digital #Gold - aka #Bitcoin – is following its analogue counterpart, hitting a new record high >$125k – a milestone in the ongoing debasement trade, as investors seek protection from currency devaluation.” Bitcoin (BTC) Price Analysis Bitcoin (BTC) is trading in positive territory after retreating from its new all-time high on Sunday. The flagship cryptocurrency has seen a substantial jump in bullish sentiment, crossing $120,000 on Friday before registering a marginal increase on Saturday. The price surged to a new all-time high on Sunday, crossing $125,000 and reaching $125,559 before settling at $123,520. BTC has crossed $125,000 again during the ongoing session, and is up 1.25%. Spot Bitcoin ETFs registered their second-best week on record, and exchange Bitcoin reserves fell to a six-year low, indicating investors were preparing to hold their assets for the long term. Popular analyst Rekt Capital argued that BTC could take time to definitively break $124,000. “There should be no surprise that Bitcoin has been rejected from ~$124k on the first time of asking in this uptrend. After all, the last time Bitcoin was rejected from $124k, the rejection preceded a -13% pullback. Bitcoin needs to prove that this $124k resistance is a weakening point of rejection. And any shallower dip or pullback from here would do just that. Meanwhile, JPMorgan and Citi predicted that BTC could surge to $200,000 by the end of the year, driven by record-breaking ETF inflows and capital rotation from gold markets. Citigroup expects BTC to hover around $133,000 by the end of the year, implying a modest upside from current levels. The banking giant’s base case scenario projects steady growth supported by inflows into spot Bitcoin ETFs. However, JPMorgan analysts believe Bitcoin remains undervalued relative to gold when adjusted for volatility, predicting an increase to $165,000 based on the Bitcoin-to-gold volatility ratio. BTC started the previous weekend with a marginal drop on Saturday before rising over 2% on Sunday and settling at $112,197. Buyers retained control on Monday as the price rose almost 2% to cross $114,000 and settle at $114,365. Despite the positive sentiment, BTC fell to a low of $112,695 on Tuesday. However, it recovered from this level to settle at $114,067, ultimately registering a marginal decline. Bullish sentiment returned on Wednesday as BTC rallied, rising over 4% to cross $118,000 and settle at $118,659. Buyers retained control on Thursday as the price rose 1.65% to reclaim $120,000 and settle at $120,621. Source: TradingView Bullish sentiment persisted on Friday despite volatility and selling pressure. As a result, BTC reached an intraday high of $123,996 before settling at $122,318. Buyers retained control on Saturday as the price registered a marginal increase and settled at $122,458. Bullish sentiment intensified on Saturday as BTC rallied, surging past $125,000 to a new all-time high of $125,559. However, it could not stay at this level and ultimately settled at $123,520. Bullish sentiment has returned during the ongoing session, with BTC reclaiming the $125,000 level and trading around $125,130. Can the flagship cryptocurrency set another all-time high? Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
