In-depth analysis: market forces and policy trends behind Bitcoin and Ethereum price fluctuations
At 2 a.m. today, the global cryptocurrency market experienced a brief shock. Affected by the news of Biden's withdrawal from the election (or the fluctuation of related market sentiment), the price of Bitcoin once bottomed out at $65,764.5, but then quickly showed its strong resilience. Not only did it quickly recover the lost ground, but it also stabilized near the $68,000 mark again after a month, and is currently stable at around $67,900. At the same time, Ethereum also experienced a similar trend, with the price rebounding strongly from a low of $3,411 to above $3,500, and the current price is about $3,527. What market forces and policy trends are hidden behind this series of fluctuations? Odaily Planet Daily will provide you with an in-depth analysis.
Bullish sentiment rises: dual drivers of buying and market confidence
Market trading operations: Institutional funds continue to flow in
Recently, the trading operations in the Bitcoin market have clearly shown bullish signals. The US Bitcoin spot ETF has achieved net capital inflows for three consecutive weeks, with a total of US$1.196 billion this week, showing the strong confidence of institutional investors in Bitcoin. In particular, Nate Geraci, president of ETF Store, pointed out that the US-listed spot Bitcoin ETF has held more than 900,000 Bitcoins, accounting for 4.3% of the total supply, with an asset size of up to US$60 billion. These data not only reflect the long-term optimism of institutions on Bitcoin, but also indicate the enhancement of market liquidity.
In addition, German private equity and consulting firm Bitcoin Group SE doubled its Bitcoin funds to 165 million euros, further confirming the international market's enthusiasm for cryptocurrency investment. Glassnode's data reveals the dominant role of ETFs and CEX (centralized exchanges) in capital flows, and their influence on the Bitcoin market far exceeds that of miners, becoming an important force driving price increases.
Political policy news: Trump’s new policy agenda may be a boon for cryptocurrencies
On the US political stage, Trump's new platform clearly supports innovative crypto policies and promises to defend the rights of Bitcoin mining, self-custody of digital assets and free trading. This statement is seen by the market as a positive factor for cryptocurrencies and is expected to bring a more relaxed policy environment to the crypto industry. If Trump is successfully elected, the market expects that the SEC's regulatory attitude towards the digital asset field will become more moderate, providing strong support for the long-term development of the cryptocurrency market.
Market Outlook: Confidence in rebounding before the end of the year increases
Several institutions and market sources are optimistic about the future trend of Bitcoin. QCP Capital predicts that as the US election approaches, the market will bet on a breakthrough, and institutions are very interested in call options for Bitcoin to reach $100,000 in December. Anthony Scaramucci, founder of Skybridge Capital, even boldly predicted that Bitcoin could reach $100,000 by the end of the year, emphasizing its potential as a long-term asset.
CryptoQuant CEO Ki Young Ju started with the futures market data, pointing out that the net position of Bitcoin CME futures contracts has returned to the level of 10 months ago. The long and short open interests have increased but the net position is negative, suggesting that market sentiment is tending to be balanced, but there is still room for growth.
Conclusion
In summary, the price fluctuations of Bitcoin and Ethereum are due to the strong market buying power, the continuous influx of institutional funds, and the positive changes in policy direction. Although the market may still fluctuate due to various factors in the short term, the overall upward trend of the cryptocurrency market is still obvious in the medium and long term. Investors should pay close attention to market dynamics and policy changes, rationally analyze risks and benefits, and seize investment opportunities.
