Bitcoin Regains Footing Near $98,000 as Liquidations Close in on $500M

Bitcoin managed to recover losses over the weekend after a sharp drop of over $2,000 on Saturday, which caught traders off guard and triggered nearly $500 million in liquidations. The cryptocurrency is now trading just under $98,000, following a low of $95,800. This dip resulted in long liquidations reaching an 11-day high of over $344 million, while short positions lost around $136 million, according to CoinGlass data. Analysts expect this volatility to continue, with strong demand from both retail and institutional investors likely to persist despite the intraday fluctuations.

The overall sentiment remains positive, fueled by strong Bitcoin demand and expectations of continued easing of global monetary policies. QCP Capital anticipates prices will stay supported as the year ends. Additionally, investor optimism is rising due to the potential crypto-friendly policies under the incoming Trump administration. Trump’s vow to promote cryptocurrency and the expected shift in leadership at the Securities and Exchange Commission (SEC), with Gary Gensler's resignation, further boost sentiment. Trump’s election promises to appoint a new SEC head, which some believe could be more favorable to digital assets, have contributed to the market’s optimism.

The favorable outlook extends beyond Bitcoin to other assets like XRP, which reached a three-year high of $1.59 on Friday. This was driven by growing speculation that the SEC might drop its lawsuit against Ripple Labs. Meanwhile, U.S.-listed spot Bitcoin exchange-traded funds (ETFs), particularly those from BlackRock, continue to see strong inflows and high trading volumes, which, along with options trading, is fueling further price volatility. Analysts predict more upside for Bitcoin in the coming months.