Bitcoin ETFs Crucial To Sustain Current Buying Pressure – Details
02 November 2024 - 4:00PM
NEWSBTC
The price of Bitcoin recorded significant leaps in the past month
rising by 14.74% according to data from CoinMarketCap. During this
price rally, the premier cryptocurrency came close to establishing
a new market all-time high, reaching a local peak of $73,149 on
October 29. Interestingly, CryptoQuant CEO Ki Young Ju has stated a
certain condition needed to sustain this price gain. Related
Reading: Tracking Bitcoin’s Profit Cycles: Could A New Market High
Be Near? Low Stablecoin Exchange Reserve Provides Need For Bitcoin
ETFs In a series of X posts on November 1, Ki Young Ju stated that
stablecoins currently provide an insufficient amount of liquidity
to sustain the present buying pressure on Bitcoin. This observation
is particularly important as traders commonly rely on stablecoins
to acquire volatile assets such as Bitcoin, due to their fixed
dollar value. Therefore, a higher stablecoin exchange reserve
translates into significant potential for an impending price gain
via wide-scale purchase. However, According to Young Ju, crypto
exchanges currently hold only 21% of the total stablecoin market
i.e. $34 billion of $166 billion, as most of these tokens are
currently being used for storage or remittances. This
development represents a slow rise in the stablecoin exchange
reserve of $30 billion recorded in September 2021 during the last
bull run, despite a 33% growth in total stablecoin shares in the
same period. Currently, the Bitcoin-to-stablecoin reserve ratio is
6.05, similar to the value seen at the last ATH. Therefore, in
order to maintain BTC’s present upward trajectory, Ki Young Ju
postulates that the Spot Bitcoin ETFs, alongside Coinbase USD
reserves, have to provide much-needed market liquidity.
Notably, the Spot Bitcoin ETFs can be said to be behind Bitcoin’s
current rally considering their impressive inflows record of over
$5 billion in the past three weeks. Of this figure, BlackRock’s
IBIT has led the market recording investments of $4.44 billion in
this timeframe. Ki Young Ju states that it is important the Bitcoin
ETFs maintain this momentum as a breakdown in pace will reduce
buying pressure, especially from brokerage firms such as Coinbase
Prime, which may result in Bitcoin falling back into consolidation.
Related Reading: Bitcoin Faces Fifth Consecutive Rejection At
$72,000, Is Another Correction Coming? Bitcoin Price Overview At
the time of writing, Bitcoin was trading at $69,608 reflecting a
1.32% loss in the last 24 hours. However, the asset’s trading
volume is up by 25.61% and is valued at $51.56 billion. For the
premier cryptocurrency, a return to above $73,000 remains much on
the card, especially with the potential of sustained ETF flows and
the upcoming US elections. If pro-crypto Donald Trump secures a
victory on the ballot, Bitcoin should definitely establish a new
all-time high with expectations of reaching $90,000-$100,000 at the
end of 2024. Featured image from Nairametrics, chart from
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