Key Insights:
Bitcoin has gained 10% in over a week to cross the $68k level.
Bitcoin ETFs saw $457 million in inflows yesterday, the largest among them being BlackRock.
On-chain indicator MVRV shows a high buying appetite in the markets.
Santiment indicates bullishness across the board.
In the last seven days, Bitcoin has seen a rally of 10% taking it from $58.9k to $68.3. Despite correcting twice, last week's rally continued and is now expected to take Bitcoin above $70k.
Bitcoin had not been able to sustain above $70k levels after its halving attempt despite seven attempts.
Bitcoin Made 7 Attempts to Sustain Above $70k In Past 1 YEear
CoinMarketCap
The current rally is however different. This time, all the major factors that affect Bitcoin's price seem to align with its rally pretty well.
Bitcoin ETFs have been seeing over one and a half billion dollars in inflows in just a week.
On-chain market indicators like MVRV are signaling decent growth opportunities.
Both whales and the retail markets are in accumulation mode.
Challenges are at their low levels.
Market liquidity is at its peak levels.
On 16 October 2024, Bitcoin ETFs have seen an inflow of $457 million, one of the highest inflows ever. Among them, BlackRock's Bitcoin ETF alone accounts for over $391 million in inflows.
Bitcoin ETFs have been seeing increased traction in the recent past. In the last seven days, the ETFs saw $1.64 billion in inflows and just $130 million dollar in outflows.
Below are the individual gains and losses of each ETF over the last 7 days.
Bitcoin ETF Flows
Coinglass
Glassnode analyst Checkmate highlighted that Bitcoin might be preparing for its next leg of gains after a phenomenal performance earlier this year.
The Market Value to Realized Value (MVRV) ratio for short-term holders has recently surpassed its long-term mean. When this happens, it indicates that the markets are ready to buy the asset, in this case, Bitcoin.
The analyst also shared that Bitcoin's future open interests (OI) are already at their all-time high.
Increased OI in futures indicates a high participation rate in the markets. Further, since futures are mostly leveraged and most futures come with an expiry date, the increase in OI shows that Bitcoin might rally very soon.
MVRV is the ratio of a crypto's market cap to the sum of all its realized gains over the years. When the MVRV ratio is higher than its mean, it indicates that the markets are undervalued and buyers are ready to buy. Opposite to this, an MVRV value that is lower than its mean indicates markets are oversold.
Santiment shared an insight showing that both whales and retail users have started accumulating Bitcoin.
Whale transactions are at their peak in the last 10-week period. Around 11.7k transactions originated from whales in a single day on 15 October 2024. Also, several ancient whales also have woken up in the recent past.
Among retail buyers, Bitcoin-focused conversations are at their peak despite the talks of an altcoin. Users are now focused more on Bitcoins than the altcoins. This could be a result of Bitcoin achieving a 59% domination in the markets which is at its 3.5-year high.
There remain a few challenges for Bitcoin, mostly regulatory and a few within the ecosystem.
Regulators across the world still lack comprehensive regulation on categorizing Bitcoin as an asset class. Further, Italy, an EU country has increased taxes on crypto assets from 36% to 42%.
Though spot Bitcoin ETFs are successful in the US, they hardly see much traction in larger economies like China and India, both of which still view them with suspicion.
China has yet to act on its 2017 Bitcoin ban, while India already charges a high 30% flat tax plus 1% TDS on gains arising from "virtual digital assets."
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