Bitcoin Price: U.S. Retail Demand and ETF Inflows Rise
Bitcoin Price– Bitcoin has made a notable recovery from its November 26 low of $90,742, reclaiming the $95,000 level. This rebound has also positively impacted the broader cryptocurrency market, with total market capitalization rising by 7.3% between November 26 and 28, reaching $3.32 trillion. As Bitcoin nears the $100,000 mark, market participants are looking for signs that the cryptocurrency has found strong support at the $90,000 level.
Coinbase Premium Index Signals Growing BTC Demand
Bitcoin’s recent drop from its all-time high of $99,655 on November 22 to a low of $90,742 on November 26 may have been driven by a temporary decrease in demand, particularly from the United States. This was reflected in the Coinbase Premium Index, which measures the price difference between Bitcoin on Coinbase (the largest U.S. exchange) and Binance’s BTC/USDT pair. The index sharply dropped during this period, indicating a decline in demand.
However, as Bitcoin’s price rebounds, the Coinbase Premium Index has shown a significant recovery. The index has increased from -0.0387 on November 26 to 0.091, signaling renewed demand from U.S. retail investors. A rising Coinbase Premium Index typically reflects stronger Bitcoin demand among U.S. retail buyers, further suggesting that Bitcoin’s growth trajectory is regaining momentum.
Bitcoin Demand Grows Despite Recent Correction
Julio Moreno, head of research at CryptoQuant, a leading on-chain analytics platform, shared insights on Bitcoin’s demand growth in a post on X (formerly Twitter) on November 27. According to Moreno, Bitcoin demand is accelerating again after the recent price correction. His analysis indicates that Bitcoin’s demand continues to expand, signaling that new investors are entering the market.
Demand expansion is what will get Bitcoin higher, said Moreno, highlighting that the increasing interest from new buyers could propel Bitcoin towards new all-time highs.
Spot Bitcoin ETFs See Positive Inflows, Boosting Market Confidence
Bitcoin’s recovery is also supported by a return of positive inflows into U.S.-based spot Bitcoin exchange-traded funds (ETFs), which flipped positive on November 26. The U.S. spot Bitcoin ETFs recorded a daily net inflow of $103 million on that day, marking the end of a two-day streak of net outflows totaling $558 million.
The Bitwise Bitcoin ETF led the charge with the largest inflow of $48 million, while BlackRock’s iShares Bitcoin ETF saw no flows for the first time since November 15. Overall, U.S. spot Bitcoin ETFs have attracted about $30.3 billion in cumulative net inflows to date, further reflecting institutional confidence in Bitcoin as a key asset class.
Institutional Investors Increasing Exposure to Bitcoin
Data from CryptoQuant also reveals that institutional investors are increasing their exposure to digital assets, particularly Bitcoin. Bitcoin investment products saw inflows of $3.07 billion during the week ending November 22, making up more than 98% of the total inflows into digital asset investment products. This trend suggests that institutional investors are becoming more confident in Bitcoin’s long-term potential, especially as the cryptocurrency nears its $100,000 target.
Bitcoin’s Supply on Exchanges Drops to Six-Year Low
Despite Bitcoin’s price surge, the amount of Bitcoin held on exchanges continues to decline. As Bitcoin’s price heads towards $100,000, fewer coins are available for sale, signaling that investors are moving their holdings into more secure storage solutions like self-custody wallets. The amount of Bitcoin on exchanges fell below 2.4 million BTC in November, marking its lowest level since November 2018. This reduced supply on exchanges could indicate that Bitcoin holders are preparing for the long term, potentially limiting the market’s ability to respond to price corrections.
Bitcoin’s Resilience and the Road to $100,000
Bitcoin’s recent recovery, combined with rising demand indicators and increasing institutional investment, suggests that the cryptocurrency is well-positioned for further growth. As market participants look for signs of sustained support at the $90,000 level, Bitcoin’s price trajectory could continue toward the $100,000 milestone. However, the ongoing decrease in supply on exchanges and the positive trend in spot Bitcoin ETFs both point to a growing market confidence in Bitcoin’s future.
As always, it’s crucial for investors to stay informed about market developments and consider all factors before making investment decisions.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
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