As a seasoned analyst with over two decades of experience in the financial markets, I have witnessed numerous trends and cycles come and go. However, the current surge in Bitcoin, especially with the potential for the US spot Bitcoin ETF issuers to scoop up its one-millionth Bitcoin, has piqued my interest more than any other event in recent memory.
This week, U.S. Bitcoin exchange-traded funds (ETFs) could acquire their millionth Bitcoin, indicating a surge in demand from investors, who are anticipating favorable cryptocurrency market conditions in November.
In November, we’re dealing with several favorable factors such as the outcome of the U.S. presidential election, the possibility of interest rate reductions by the Federal Reserve, and Russia rescinding its Bitcoin mining ban.
Approximately 5% of the total market value of Bitcoin, currently standing at around $1.34 trillion, is held by issuers of U.S.-listed Bitcoin ETFs, amounting to over 976,893 Bitcoin worth more than $66.2 billion, as per data from Apollo and SoSoValue.
To purchase an extra 23,107 Bitcoins and achieve that milestone, Bitcoin ETFs must collect approximately $1.55 billion in total net inflows (at present prices). This equates to about $301 million being added daily for the goal to be reached this week.
Bitcoin expert Alessandro Ottaviani pointed out that a staggering $3 billion has been invested in spot Bitcoin Exchange-Traded Funds (ETFs) over just the past two weeks. He further emphasized this by saying: “A whopping $3 billion has poured into these Bitcoin ETFs in such a short span.
“If this pace continues through November, ATH will be [inevitable].”
In simpler terms, Bitcoin historically experiences significant increases approximately several months following a halving event – the latest one took place in April 2024. Moreover, the results of the U.S. presidential election on November 5 may act as positive momentum for Bitcoin’s growth.
In November 2020, Bitcoin surged approximately 43% after the May 2020 halving event and President Biden’s victory, and potential price surges of this magnitude could occur again, regardless of who wins the election. On the other hand, Henrik Andersson, the chief investment officer at Apollo Capital, contends that a Trump victory could significantly impact the crypto market:
Starting from November 2020, Bitcoin has recorded more significant monthly increases only in December 2020 and February 2024 – the initial full month following the debut of spot Bitcoin Exchange-Traded Funds (ETFs).
Recently, some universities have begun adopting the Grayscale Bitcoin Mini Trust, as evidenced by Emory University in Atlanta disclosing they hold over $15.1 million of this trust, according to a filing made on October 25th with U.S. securities regulators.
On November 6th and 7th, the Federal Open Market Committee of the United States Federal Reserve is due to convene. According to predictions made by CME Group’s Fedwatch tool, there is approximately a 94.7% probability that interest rates will decrease by 0.25%.
Reducing interest rates typically alleviates the monetary stresses faced by common consumers, and it generally brings about a favorable effect on the market, particularly in the immediate future.
Simultaneously with the lifting of the Bitcoin mining ban by Russia on November 1, this move is also perceived as positive news for Bitcoin, as it enhances network decentralization and security.
Currently, Bitcoin’s price stands at approximately $67,700. It’s facing some resistance trying to surpass $70,000, but it has a solid foundation of support around the $65,000 mark.
[On October 26], crypto trader ‘Luca’ noted that there is a substantial accumulation of long positions hovering slightly below the 65K mark, which also serves as a significant level of support.
”Lose that, and the next support range at 60K gets exposed.”
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2024-10-28 08:49