According to BlockBeats, on November 26, Bitfinex released a report stating that 'the movement of Bitcoin approaching the historic $100,000 mark is driven by unprecedented inflows into Bitcoin ETFs and strong institutional demand. Although it faced profit-taking resistance at its latest historical peak, Bitcoin has shown resilience, remaining around $96,000 over the weekend, and subsequently regained some upward momentum during early trading on Monday. Since the low of $66,880 before the U.S. presidential election, Bitcoin has risen by 47%, and has increased an astonishing 130% year-to-date, opening up new horizons. The performance of Bitcoin compared to traditional assets is undeniable: Bitcoin's market capitalization has now surpassed that of Saudi Aramco, becoming the seventh-largest asset globally, with a valuation exceeding $1.9 trillion at its peak.
Despite the impressive upward momentum of Bitcoin, it is not without profit-taking from long-term holders. Although selling pressure has increased, the current pressure remains manageable compared to the historical peaks in March 2021 and March 2024. These trends indicate that market momentum is temporarily stalled, but the overall market may absorb selling pressure and continue to rise in the medium term.
The overall cryptocurrency market (excluding Bitcoin and Ethereum, referred to as the Total3 index) has also reached a new cycle high, driven by surging investor sentiment, resulting in a 23.2% increase from low to high in the Total3 index last week — the largest increase since April 2021. Large-cap altcoins, such as Solana (SOL), have reached new historical highs, marking their breakthrough of key resistance levels, including the peak in April 2022.
The market capitalization of altcoins is now close to the $984 billion peak in May 2021, indicating that speculative funds are shifting from Bitcoin to altcoins. Historically, this kind of fund rotation often signals the arrival of 'altcoin season,' where altcoins outperform Bitcoin.
In fact, the annualized financing rate for large-cap altcoins has surpassed the 45% threshold, marking an intensification of speculative activity. With increased participation from retail investors, short-term volatility is expected to rise, further boosting the momentum of altcoins. However, these conditions also require caution, as extreme financing rates often foreshadow sharp market corrections.
