Bitcoin price skyrockets to over 100000! Will there be a backlash in the near future?
With Trump's successful election as the next President of the United States in early November, the price of Bitcoin began to soar all the way. The increase in the past month has been close to 40%, and today (12/5) morning has soared to over 100000, and there is no obvious sign of any correction. This has caused many investors to have a "fear of heights" and worry about whether there will be a pullback. So, what are the reasons behind Bitcoin's strong performance? Will the future market adjust?
Where does the rise of Bitcoin come from?
Bitcoin currently has many positive narratives. For example, Trump himself has always been regarded by the market as a more inclusive presidential candidate for cryptocurrency. He has already expressed his support for bitcoin in public many times, and even said that the United States should consider bitcoin as a strategic reserve asset. And recently, some members of its team even suggested that the United States switch from selling gold to buying Bitcoin. These actions on the Bitcoin platform undoubtedly bring significant positive narratives to Bitcoin.
Driven by this positive narrative, a large amount of funds have been continuously buying Bitcoin in the past month, which has also contributed to the continuous rise of Bitcoin prices (click to see the latest analysis). With the launch of Bitcoin spot ETFs this year, relevant data from various Bitcoin ETFs can also reveal the current popularity of Bitcoin among funds. From the data, in the past month, Bitcoin ETFs have only shown net outflows on 6 trading days, while the majority of other trading days have been net inflows. It can be seen that various institutions are constantly buying Bitcoin.
At the same time, the balance and stock of Bitcoin on major exchanges have been showing a downward trend, indicating that the selling force is not strong at present, and buying is still mainstream, which determines that the recent selling pressure on Bitcoin is not particularly strong.
When will the Bitcoin market rebound?
So, in the current market sentiment, will Bitcoin return to its previous form? Based on current data from various sources, there is no sign of a short-term correction in Bitcoin. But this does not mean that the Bitcoin market can rest assured, as there are currently at least two potential destabilizing factors.
Firstly, it is the Christmas market. As is well known, whenever developed countries in Europe and America approach the Christmas holiday, investors and institutions tend to settle their positions and take profits. Therefore, this potential factor may put some selling pressure on the price of Bitcoin in the near future.
Secondly, the recent high increase in XRP has led to significant funding effects. The price of XRP has risen more than four times in the past month. Since Gray Gensler, the chairman of the US SEC who had previously been at odds with XRP, took the initiative to resign soon after Trump was elected, the market believed that XRP might get rid of the long-standing lawsuit, thus driving up the price of XRP. Not only that, there were even rumors circulating in the market that Elon Musk might invest in XRP, further raising the price of XRP. Due to the fact that XRP itself is already a high market value currency, after this wave of gains, its market value has risen to the third place in the cryptocurrency market, second only to Bitcoin and Ethereum. This growth rate is quite rare for a high market value token, thus creating a strong bloodsucking effect, causing funds that should have flowed into Bitcoin, Ethereum, or Solana to ultimately flow into XRP.
conclusion
The strong performance of Bitcoin in the past month cannot be separated from multiple drivers such as favorable policies, capital inflows, and market sentiment. However, in the short term, the market may face seasonal selling pressure and interference from the funding effects of other high market value currencies (such as XRP), and price trends may fluctuate to a certain extent.
For investors, in the current high price range, chasing price increases requires caution and attention to potential opportunities after a retracement. Meanwhile, in the medium to long term, the upward logic of Bitcoin remains strong and has good investment value. Under the dual influence of high market sentiment and external environmental changes, the future trend of Bitcoin will still be a wonderful 'game'.
About BingX
BingX Established in 2018, it is a leading global cryptocurrency exchange that provides diversified products and services such as spot trading, derivatives, copy trading, and asset management to over 10 million users worldwide. At the same time, it regularly provides market analysis of mainstream currencies such as Bitcoin and Ethereum prices to meet the needs of beginners to professionals at different levels. BingX is committed to providing a trustworthy platform that empowers users with innovative tools and features to enhance their trading capabilities. In 2024, BingX Proudly becoming a major partner of Chelsea Football Club, marking its first exciting debut in the world of sports.
This article is provided by the official and does not represent the position or investment advice of our website. Readers must make their own careful evaluations.
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