Ah, Bitcoin (BTC), that fickle friend who reached a dizzying $99,500 on February 21, only to promptly trip over its own shoelaces. It seems our beloved cryptocurrency couldn’t muster the enthusiasm to keep the party going. Traders, bless their hearts, have been as eager to open bullish positions as a cat is to take a bath, especially after the cold shoulder it received at $102,000 on February 3.
Now, the Bitcoin futures premium usually dances between 5% and 10% in neutral markets, like a wallflower at a high school dance. But since February 3, it seems to have lost its rhythm, and the recent rise from $95,500 to $99,500 was about as exciting as watching paint dry.
Bitcoin price surged briefly due to China’s adjusted M1 supply data
In a plot twist worthy of a soap opera, investor optimism was briefly ignited by a surprising spike in China’s M1 monetary supply data. But hold your applause! This was merely a case of mistaken identity, as the methodology was tweaked to include individual checking accounts and those pesky non-bank payment platforms like Alipay and WeChat Pay.
Meanwhile, credit growth in China has been on steroids, with new loans soaring by $702 billion in January—the highest since 1992! Michelle Lam, the Greater China economist at Societe Generale, cheerfully noted that this suggests policymakers are “adding fuel to the economy.” Or maybe just throwing a match into a gas station. Who knows?
To see if Bitcoin’s recent price gains have tickled the fancy of whales and market makers, we must dive into the murky waters of the BTC options markets. If traders are feeling jittery, put (sell) options will trade at a premium, pushing the 25% delta skew metric above 6%. If they’re feeling optimistic, it dips below -6%. It’s like a mood ring for the crypto world!
But alas, the Bitcoin options market showed about as much excitement over the $99,500 retest as a sloth at a marathon, with the 25% delta skew indicator stuck at 5%. The last time we saw any bullishness was on January 26, when Bitcoin flirted with $105,000. Ah, memories!
For a broader view of cryptocurrency demand, let’s peek at the stablecoin market. Typically, when interest in cryptocurrencies in China is high, stablecoins trade at a premium of 2% or more above the official US dollar rate. But when fear sets in, it’s like a Black Friday sale as traders rush to exit the crypto markets.
The USDT premium in China has been lounging around 0.5% for the past week, comfortably within the neutral range. The last time stablecoins traded at a 2% premium was on February 3, which means traders are largely unfazed by Bitcoin’s recent waltz toward $100,000.
Mixed emotions following President Trump’s cabinet picks
Traders’ lack of enthusiasm reflects two weeks of failed attempts to keep levels above $98,000, coupled with disappointment over President Trump’s crypto council, which has been canceled in favor of informal summits. Because who needs structure when you can have chaos?
On a brighter note, the US Securities and Exchange Commission has decided to drop charges against Coinbase, which is like getting a surprise gift from your least favorite relative. Additionally, Howard Lutnick, former CEO of Cantor Fitzgerald, has been confirmed as the US Secretary of Commerce. Lutnick is a vocal Bitcoin supporter, which gives traders a glimmer of hope for institutional adoption. Or at least a reason to keep refreshing their Twitter feeds.
Despite the tepid interest in Bitcoin, a glimmer of hope for an all-time high remains as investors slowly wake up to the cryptocurrency’s potential as a hedge against inflation and censorship. It’s like watching a toddler learn to walk—slow, wobbly, but oh-so-adorable.
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2025-02-21 23:35