Bitget App
Trade smarter
Buy cryptoMarketsTradeFuturesCopyBotsEarn
Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low

Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low

BlockBeatsBlockBeats2024/11/08 09:10
By:BlockBeats

Analysts predict a potential price range for Bitcoin of $102,000 to $140,000, with strong technical indicators supporting continued price increases.

Original title: The Bitcoin Report: Key Trends, Insights, and Bullish Price Forecasts
Original source: Bitcoin Magazine Pro
Original translation: Felix, PANews


Bitcoin Magazine Pro published an article reviewing Bitcoin in October and discussing some key topics. Including the decline in Bitcoin's exchange balance, ETF fund inflows exceeding $5 billion, and optimistic predictions that may redefine Bitcoin's value in the coming quarter. The following are the details of the report.


Main highlights:


· Bitcoin on-chain analysis: Bitcoin exchange balances are at a historical low, indicating that holders are increasingly confident and increasingly choosing self-custody.


· Bitcoin ETF surge: ETF inflows exceeded $5.4 billion in October, with BlackRock's IBIT leading the market. This reflects the growing acceptance of Bitcoin in mainstream financial markets.


· Mining Dynamics: Russia and China are expanding their mining influence, while the United States still maintains the largest share of computing power.


· Bullish Price Prediction: Bitcoin analyst Tone Vays predicts a potential price range of $102,000 to $140,000 by mid-2025, supported by strong technical indicators.


Bitcoin On-Chain


Highlights


· BTC exchange balances hit new lows, indicating rising preference for self-custody

· Addresses with balances over 100 reach all-time highs, reflecting growing adoption

· Strong on-chain fundamentals suggest price momentum will continue into 2025.


Forecast


The decline in Bitcoin exchange balances and growing wallet adoption bodes well for the potential for higher prices, and investors should watch the growth of exchange inflows and high-balance wallets as indicators of demand and potential price strength in Q4 and beyond.


Insight


The total balance of Bitcoin on exchanges declined significantly in October and is now just under 3 million, as shown in Figure 1. This decline suggests that investors are increasingly choosing self-custody rather than leaving funds on exchanges, a trend often associated with long-term holding strategies. When exchange balances decline and prices rise, it indicates confidence in Bitcoin's medium- to long-term trajectory. This shift toward self-custody could become a supply-side constraint that could put upward pressure on prices if demand continues.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 0


Mining


Highlights


· Russia and China currently contribute significantly to global Bitcoin hashrate.

· The United States still leads in hashrate, but Russia holds second place, while China is quietly increasing activity despite a mining ban.

· Emerging markets such as Ethiopia and Argentina are also seeing growth, which could affect hashrate distribution.


Forecast


If Chinese and Russian hashrates continue to grow, U.S. miners could face new global competition next year.


Insight


Russia and China are emerging as key forces in the global Bitcoin mining space in recent times. Russia is now the second-largest contributor to global hashrate. It taps into abundant natural resources and gives miners access to cost-effective energy. This expansion is driven by the region’s support for mining as a profitable and strategic economic activity. Meanwhile, underground mining continues despite an official ban in China, where underground mining has increased in recent years. This dual development hints at a shift in mining power that could affect market dynamics, especially as the global distribution of hashrate is no longer dominated by the United States.


While the United States still leads in Bitcoin hashrate, Russia’s rapid rise and China’s resilience pose challenges to U.S. miners, and emerging markets such as Ethiopia and Argentina are also increasing mining activity, creating a more decentralized global mining network. This diversification could enhance the security and operational stability of the Bitcoin network, making it less vulnerable to regional disruptions. As these trends continue, U.S.-based Bitcoin miners could face more intense competition, both in terms of access to energy resources and in maintaining profitability in volatile market conditions.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 1


ETFs


Highlights


· BlackRock’s BTC ETF (lBlT) had a maximum daily inflow of $872 million, with a net trading volume of $4.6 billion for the month.


· Fidelity’s maximum daily inflow was $239 million, but its net trading volume was only $496.8 million, dwarfed by lBIT.


· Bitwise (BITB) had a maximum daily inflow of $100.2 million, with a net trading volume of $137.3 million for the month.


Forecast


Expect volatility in BTC ETFs in the short term. While IBlT remains the volume and liquidity leader, it may not offer the best volatility to trade. FBTC and ARKB have seen significant fluctuations in relative size, providing the best opportunities to trade.


Insight


Net inflows into Bitcoin ETFs reached a record high of approximately $5.415 billion in October (Figure 1). The popularity and demand for these products has prompted the U.S. SEC to further approve options trading on many BTC ETF products. Increased speculation, leverage, margin calls, market maker delta hedging, and sentiment effects may affect BTC ETFs, which will have a carryover effect on the direct Bitcoin spot market itself.


BlackRock’s IBlT is far ahead, with monthly volume of $4.6 billion and the most active trading. For traders looking to act on market dynamics, this also means that for every trade that is lBlT, there is someone willing to take it. Other ETF options, such as Fidelity’s FBTC, Ark 21Shares’ ARKB, and Bitwises BlTB, can offer better entry opportunities as the volume of each option is reduced (Figure 2). While ETFs seek to perfectly track the BTC market price, lower liquidity and volume can create opportunities to enter favorable positions during these imbalances.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 2


Stocks


Highlights


· MicroStrategy (MSTR) announced a three-year, $42 billion Bitcoin investment plan to put more BTC on its balance sheet.


· Despite Bitcoin’s 63.9% year-to-date gain, six of the top ten Bitcoin-related stocks have underperformed (negative returns).


· Metaplanet INC (TYO: 3350) is up 838.82% year-to-date, primarily due to the announcement of a Bitcoin-on-balance sheet strategy.


Forecast


Bitcoin-related stocks could rally in the coming months, driven by positive sentiment around Bitcoin at the start of Q4. Opportunities could exist in stocks like Semler Scientific (SMLR), which is quietly adding Bitcoin to its balance sheet, providing a positive upside to the stock’s value.


Insights


While it seems intuitive that Bitcoin-related stocks will follow BTC's bullish trend, most have not benefited from Bitcoin's 63.9% year-to-date (YTD) gain (Figure 1). Marathon Digital (MARA) Riot Platforms (RlOT) and CleanSpark (CLSK) are down -31.42%, -38.98% and -6.39% YTD, respectively, indicating operational difficulties or sensitivity to crypto mining costs, Tesla (TSLA) is up just 0.2% since the beginning of 2024, and Block inc. (SO) is down 6.72%. While Coinbase (COlN) and Galaxy Digital Holdings (GLXY or BRPHE) have performed positively, their performance has not outperformed the spot Bitcoin price trend.


In contrast, MicroStrategy (MSTR) surged 263.68%, reflecting the impact of its leveraged Bitcoin holdings and investor confidence in its Bitcoin-focused strategy. MicroStrategy Executive Chairman Michael Saylor announced a three-year $42 billion Bitcoin investment plan, continuing the company's buy and hold strategy (Figure 2). In Japan, Metaplanet Inc. (TYo: 3350) has gained 838.82% year to date since announcing its Bitcoin reserve strategy earlier this year. With Bitcoin on the cusp of its next bull run, companies should consider adopting a Bitcoin holding strategy.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 3


Derivatives


Highlights


· Bitcoin recently broke through $70,000, with short positions liquidated for over $100 million.

· Funding rates remain relatively neutral, likely due to uncertainty surrounding the US election.

· Funding rates are very low at this stage in the market cycle.

· This is bullish as it will allow BTC prices to rise further without accumulating excessive leverage in the derivatives markets.


Forecast


Bitcoin is expected to rise towards the end of the year once uncertainty surrounding the US election and the subsequent market volatility passes.


Insight


BTC has been trending upwards over the past month. While there have been downside corrections along the way, most of the liquidations have been for traders who attempted to short BTC.


The US election has created short-term uncertainty for the Bitcoin derivatives market. Expect significant market volatility for a few weeks.


However, once the impulsive reactions in either direction subside, expect the derivatives market to stabilize again. Currently, funding rates remain very low at this stage in the Bitcoin market cycle. This is bullish and should allow Bitcoin prices to move significantly higher in the coming months until we see funding rates of +0.06. At that point, caution may be warranted, but we are far from reaching these levels at this point.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 4


Adoption


Highlights


· MicroStrategy (MSTR) announced a $42 billion capital program, including a $21 billion ATM equity offering to purchase Bitcoin.


· Metaplanet (3350.T) holds over 1,000 BTC and is the largest publicly traded Bitcoin holder in Asia.


· Microsoft (MSFT) to hold shareholder meeting in December and vote on potential Bitcoin financial strategy.


Forecast


MicroStrategy's (MSTR) decision to use Bitcoin as a financial reserve is a boon to shareholders and boosts Bitcoin adoption among publicly traded institutions. Since January, companies such as Metaplanet (Asia's largest public Bitcoin holder with over 1.000 BTC), Semler Scientific, and Samara Asset Group have followed suit. This trend could influence Microsoft (MSFT) shareholders to vote on a similar strategy in December.


Insight


MicroStrategy plans to issue $21 billion of Class A common stock over the next three years to buy Bitcoin. Michael Saylor's $42 billion capital plan includes a $21 billion stock offering and aims to raise $21 billion in fixed-income securities to finance the purchase of Bitcoin.


Inspired by MicroStrategy's success, Japan's Metaplanet also adopted a Bitcoin reserve strategy this spring and currently holds more than 1,000 BTC, becoming the largest publicly traded Bitcoin holder in Asia. Due to Bitcoin's deflationary nature and an average annual return of 40%, it has become the preferred reserve asset for hedging excess cash. Even large technology companies are beginning to follow suit: Microsoft shareholders will vote in December on whether to adopt Bitcoin as a reserve asset. Although management has said "rejection", strong shareholder interest may change the decision, which may trigger a wider adoption of Bitcoin by listed companies.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 5


Regulatory


Highlights


· SEC approves Bitcoin ETF options: a major step toward mainstream financial product integration.


· Pennsylvania’s Bitcoin Bill of Rights: a milestone in protecting Bitcoin self-custody and payment rights.


· Thailand proposes crypto fund access: crypto adoption in Asia could increase


Forecast


Recent regulatory developments, particularly the approval of Bitcoin ETF options and active legislative movement in the United States, could significantly boost investor confidence. This could lead to a surge in Bitcoin prices, especially if these moves are seen as paving the way for more mainstream financial integration. Also, monitor regulatory developments from key markets such as the United States, where political changes could affect regulatory approaches, and countries such as Asia are opening up to crypto funds, which could affect regional and global market sentiment.


Insights


October marked a pivotal moment in the regulatory landscape for Bitcoin, with the SEC’s approval of Bitcoin ETF options trading demonstrating the growing acceptance of cryptocurrencies by traditional finance. This development not only provides investors with an additional hedging and speculation tool, but may also improve Bitcoin’s liquidity and price stability in the long run.


Pennsylvania’s recent legislation recognizing Bitcoin’s self-custody and payment rights could influence other U.S. states. This could lead to a more Bitcoin-friendly environment, reduce concerns about strict regulation, and create an atmosphere conducive to investment. The move by Asian markets, especially Thailand, to allow private funds to invest in cryptocurrencies, hints at the widespread acceptance of cryptocurrencies in one of the world’s largest economic zones, which could drive trends in neighboring countries.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 6


Macro Outlook


Highlights


The rising US federal debt highlights the limitations of fiat currencies and drives interest in Bitcoin. The continued inflation shown by the CPl enhances Bitcoin's appeal as a hedge. Amid concerns about the long-term stability of the US dollar, institutional investors are increasingly considering Bitcoin.


Forecast


Bitcoin is expected to continue its upward trend, driven by growing concerns about the federal debt and inflation. Monitoring the CPl and federal debt levels can provide early indicators for Bitcoin's potential appreciation in the coming months.


Insights


In a high-debt, inflation-prone market environment, Bitcoin’s value proposition is clearer than ever. The first chart below shows the relationship between federal debt and Bitcoin price. As federal debt climbs to unprecedented levels, the sustainability of the U.S. dollar as a store of value has come under increasing question. Investors, especially institutional investors, are seeking alternatives that are not subject to currency debasement. Bitcoin’s limited supply provides an effective hedge against the risks of excessive debt accumulation and currency debasement.


The second chart below shows the continued rise in inflation in the Consumer Price Index (CPI) relative to Bitcoin, which remains high even when excluding more volatile categories such as food and energy. This solidifies Bitcoin’s position as a long-term store of value that preserves purchasing power during times of economic uncertainty. With inflation showing no signs of abating and federal debt continuing to expand, Bitcoin is uniquely positioned as a strategic asset to preserve value and hedge against economic instability.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 7


Price Prediction


Highlights


· Price action is about to close at all-time highs on the daily, weekly, and monthly charts, which is very bullish on all of these time frames.


· This is only the 7th time in Bitcoin history that MRl has closed the 2-month bar with a green asterisk. All six previous times resulted in gains of more than 100% over the following year.


· The Cup and Handle pattern and Fibonacci extensions provide additional bullish price targets in the $100,000 to $105,000 range.


Forecast


The biggest concern right now is "groupthink" and everyone expects prices to exceed $100,000. Personally, don't see anything worrisome in the TA charts, on-chain analysis, 4-year halving cycle analysis, mining, or any regulatory setbacks. Many people bought Bitcoin expecting greater regulatory acceptance under the Trump administration.


Insights


Bitcoin is primed for a potential bull run, with technical indicators pointing to three price targets. The Tone Vays MRl indicator on the 2-month chart shows gains of at least 100% over the past 6 months, suggesting a peak of around $140,000 or more by Q2 2025. This pattern is consistent with the big rallies in 2017 and 2021.


In addition, the cup and handle pattern on the weekly and monthly charts points to a target of $105,000, which is usually achieved within 4-6 months based on historical trends. Finally, the Fibonacci extension shows an initial target of $102,000, and if the previous cycle repeats, higher levels of $155,000 and $210,000 may be reached.


Bitcoin Market Report: ETF inflows exceeded $5.4 billion in October; exchange balances are at a historic low image 8


Original link

0

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

PoolX: Locked for new tokens.
APR up to 10%. Always on, always get airdrop.
Lock now!