On Monday, January 1, the Bitcoin (BTC) price gave a strong bounceback gaining more than 7% and shooting past $45,000 levels. Everyone is awaiting the spot Bitcoin ETF approval which shall tentatively happen by the next week around January 10.
Bitcoin Price Above $50,000
As per the recent Matrixport report, the Bitcoin funding rate has stayed at heightened levels, suggesting that crypto traders maintain a strong bullish outlook and anticipate the imminent approval of a Bitcoin ETF. With the Bitcoin dominance indicator declining to 50.3%, there are indications that an altcoin season may be on the horizon, propelling the entire crypto market.
While Tether minting activities, a signal of fiat-to-crypto inflows, are not increasing, the ongoing price rally implies a scarcity of sellers in the market, pushing prices higher. Currently, the funding rate has reached a new high at +66%, meaning long positions pay shorts an annual rate of 66% to maintain their positions.
This dynamic in the futures market squeezing the spot market is expected to drive Bitcoin beyond the $50,000 target level for January 2024, which now appears reasonably attainable. There is even speculation that Bitcoin could surpass $50,000 by the end of the current week.
BTC Miner Activity on The Rise
Market analysts have already started looking past the Bitcoin ETF approval as many believe this could be a sell-the-news event. Some market analysts have already started looking forward to the Bitcoin halving event in April 2024. The BTC miner activity has already skyrocketed in recently over the past week.
Bitcoin miners absolutely EXPLODED higher in the 8 days following this tweet.
Contrary to popular opinion, Wall Street does not know everything.
Importantly, Wall Street still has not priced in $60,000 or $100,000 Bitcoin yet.
The big move in miners hasn’t even begun. Breathe. https://t.co/iXbNCr7wbf
— Mike Alfred (@mikealfred) January 1, 2024
According to the Matrixport report, Bitcoin mining companies are showing a trend of limiting supply around the upcoming halving cycles, anticipated for April 2024. This strategic move could contribute to a potential supply shortage in the market. The report highlights the possibility of a surprising Bitcoin price surge in the coming year.
Matrixport emphasizes that historical trends indicate a robust rally in BTC prices during halving cycles, coinciding with the US election cycle. The average return for BTC during the years 2020, 2016, and 2012 was an impressive +192%. The report speculates that this pattern could propel Bitcoin toward the previously set target of $125,000.
The target was established in July 2023 based on Matrixport’s ‘one-year-new-high’ indicator. Additionally, the report draws a parallel to the strong performance of US stocks during US election years, with only two down years (2008 and 2000) since 1960.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.