Last week, the BTC price steadily rose, with daily gains for seven consecutive days, returning to $100,000. After BTC touched a low of $91,530.45 on December 30, the price rebounded with seven consecutive days of increases. By January 6, BTC reached a high of $102,724.38, with a maximum weekly increase of 11.35%. Currently, the real-time price of BTC is $101,812.95. The price trend of ETH is similar to BTC, rising for seven consecutive days, reaching $3,744.83 on January 6, with a maximum weekly increase of 13%. The current price of ETH is $3,683.14 (data from Binance spot as of January 7, 12:16).
This week, sell pressure shrank, market liquidity recovered, and the strong rebound of BTC led other popular cryptocurrencies like ETH and SOL to rise sharply, enhancing the bullish sentiment in the market. However, market trader Crypto Scient believes that $100,000 remains a key turning point for BTC, and unless BTC converts $99,000 into a long-term support level, the price may retest the $90,000-88,000 range.
Market Analysis
As of January 6, 2025, the total market capitalization of cryptocurrencies worldwide reached $3.65 trillion, up 6.7% from $3.42 trillion the previous week. Among them, the US spot BTC ETF performed well, with total on-chain holdings exceeding 1.129 million BTC, accounting for 5.70% of the total BTC supply, valued at about $106.8 billion. This week, the net inflow of funds into the US spot BTC ETF reached $240 million, with a historical cumulative net inflow of $38.9 billion, further consolidating its position as an important funding entry point for the market.
Bullish sentiment in the BTC options market is high, with traders betting on prices breaking through $120,000.
On January 6, Deribit data showed a significant increase in options activity with strike prices of $110,000 and $120,000, reflecting traders' strong expectations for further price increases. As of now, the open interest value for call options with a strike price of $120,000 has reached $1.52 billion, making it the most popular contract type on the Deribit platform. With Trump's inauguration approaching, a new wave of optimism has emerged in the BTC market, particularly in the options market.
Meanwhile, the put/call ratio for all expiration dates has dropped to 0.24. This low ratio indicates that the trading volume of call options far exceeds that of put options, highlighting market confidence in BTC price increases. Additionally, the price pullback at the end of December caused BTC to temporarily touch $91,000, but it has quickly rebounded to $101,000, further solidifying the market's optimistic expectations for an upward trend.
With Trump's impending inauguration, the market remains focused on potential policy benefits, and the activity level in the BTC options market may serve as a leading indicator for future price movements.
Both miner sell pressure and exchange inflows have decreased, with supply tightening supporting a mid-term bullish outlook for BTC.
On January 6, Bitfinex reported that the liquidity stock ratio of BTC has significantly dropped from 41 months in October 2024 to 6.6 months, with continuous outflows from the exchange's inventory. This week, only 200,000 BTC flowed into the exchange, and the unrealized profit rate for short-term holders fell to 12%. The increase in stablecoin inventory also indicates that market funding reserves are ample, and sentiment is cautious. During the same period, BTC inflows to exchanges and miner outflows continued to decline, further alleviating market sell-off pressure and strengthening mid-term bullish expectations for BTC.
Meanwhile, the outflow of BTC from miners to exchanges has also significantly decreased, indicating a slowdown in miner sell pressure. CryptoQuant data shows that on November 11, 2024, miners sent 25,367 BTC to exchanges, reaching a high, but by early January 2025, this number had dropped to between 2,000 and 5,000 per day. Changes in miner behavior reflect their preference to hold positions to respond to price increases.
The dual effects of reduced supply and eased sell pressure lay the groundwork for BTC's mid-term rise. As the market's chip structure stabilizes, BTC's upward trend is expected to continue.
Institutional and corporate buying is accelerating, and BTC is expected to break through $200,000 by 2025.
On December 31, Standard Chartered's head of digital asset research, Geoffrey Kendrick, predicted that BTC prices would reach $200,000 by the end of 2025, with continued institutional and corporate accumulation as the core driving force. Since the beginning of 2024, institutions have purchased 683,000 BTC through channels such as spot BTC ETFs and MicroStrategy.
At the corporate level, the 'BTC accumulation plan' has become a trend. According to Bitwise CEO Hunter Horsley, 'Since last Monday, 11 publicly listed companies have purchased more BTC. 2025 may be a significant milestone for more companies to adopt the BTC standard.' The Japanese listed company Metaplanet plans to increase its BTC holdings to 10,000 BTC by 2025 to promote global adoption.
The dual effect of accelerating institutional buying and easing supply conditions lays a solid foundation for BTC's medium to long-term rise in 2025.
Trump-themed Memecoin leads the way, with altcoin sentiment warming up.
On January 7, the US Congress officially confirmed Trump's election as president, with his inauguration imminent. His crypto-friendly policies are expected to drive related tokens to rise. The Trump-themed Memecoin TRUMP has risen consecutively for three days since January 4, with a cumulative increase of over 80%; MAGA, TRUMPCOIN, and others have seen increases close to 100%, but have since pulled back. However, family project World Liberty Financial's holdings of LINK, AAVE, and other tokens have not seen significant upward momentum.
Market sentiment has turned optimistic, with the cryptocurrency fear and greed index rising to 78, entering the 'extreme greed' range. BTC has returned above $100,000, driving a general bullish sentiment in the market, although altcoin performance is mixed. SOL has broken through 220 USDT again, AVAX is up 6%, while SUI has retreated to 5 USDT after reaching a new high.
The ETH ecosystem has seen a short-term pullback, with LDO down about 3% and ENA down nearly 10%. Despite the positive market outlook, volatility remains a core focus in the near term, and investors need to be cautious of short-term pullback risks.
Market Highlights
Federal Reserve reserves have fallen below $3 trillion, reaching the lowest level since 2020.
On January 3, according to the Federal Reserve data, the reserves of the US banking system fell to about $2.89 trillion for the week ending January 1, dropping below the $3 trillion mark, marking the lowest level since October 2020, and recording the largest weekly decline in two and a half years, a reduction of about $326 billion.
Year-end regulatory requirements prompted banks to reduce balance sheet activities, with funds flowing from banks to the Federal Reserve's overnight reverse repurchase (RRP) tool. Meanwhile, the Federal Reserve continues to remove excess cash from the financial system through its quantitative tightening (QT) program, further tightening liquidity. Investors are advised to closely monitor changes in Federal Reserve policy and their potential impact on the banking system.
BTC mining difficulty reached a new high, with miner revenues reaching $1.44 billion.
The mining difficulty and hash rate of the BTC network continue to rise. On December 30, 2024, BTC mining difficulty was adjusted upward by 1.16% to 109.78 T, reaching a new all-time high, with an average network hash rate of 804.04 EH/s. The next difficulty adjustment is expected to increase to 111.20 T. Despite improvements in mining efficiency, the rapid growth of global hash rate and rising energy costs put pressure on mining profitability.
In a high-difficulty environment, miner revenues remain strong, with cumulative revenues reaching $1.44 billion in 2024. Major mining company MARA reported that it generated $8.7 million in interest income in the first three quarters by optimizing resource utilization and lending strategies, while its powered hash rate reached 53 EH/s. As competition intensifies, miners need to continuously optimize strategies to maintain profitability in a fierce market.
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