Bitcoin Approaches $44,800 as ETF Buying Pressure Sustains

The resurgence of Bitcoin has also lifted other top altcoins like Ethereum.

Cryptocurrency market volatility as of 09:45 AM on 08/02/2024. Source: Coin360

In the early morning hours of February 8, the world's largest cryptocurrency, Bitcoin (BTC), staged a recovery from the $42,000-$43,000 range that had persisted since late January, even peaking at $44,780.

This marks Bitcoin's highest price since reaching $48,969 on January 11, coinciding with the approval of Bitcoin spot ETFs.

4-hour chart of BTC/USDT pair on Binance as of 09:45 AM on 08/02/2024

After several days of consolidation, BTC accelerated its upward momentum thanks to stable buying pressure from institutions through ETFs. Transaction volume data from Bloomberg shows that despite a noticeable decline in ETF Bitcoin volumes over the past week since their inception, trading volumes have remained stable in the range of $600 million to $1 billion USD per day.

Additionally, according to BitMEX Research, from January 26 to February 7, Bitcoin spot ETFs consistently saw inflows, surpassing selling pressure from Grayscale's GBTC. However, these volumes have been gradually declining in recent days.

Despite these fluctuations, these developments indicate a steady buying force for Bitcoin, bolstering its recovery amidst lackluster market conditions.

Furthermore, Bitcoin continues to be anticipated for upcoming events, with the halving event around mid-April being the most significant. Many investors are banking on the halving, with BTC options contracts targeting $55,000 by late June 2024 currently being the highest-volume contract on the Deribit derivatives exchange.

Similar to BTC, Ethereum (ETH) has also shown impressive recovery over the past 24 hours, rising to $2,444.

4-hour chart of ETH/USDT pair on Binance as of 09:45 AM on 08/02/2024

On February 7, the world's largest smart contract network successfully deployed the Dencun upgrade on the Holesky testnet, the final testnet needed after Goerli (January 17) and Sepolia (January 30), ahead of its scheduled mainnet launch at the end of February.

Another piece of news contributing to ETH's rise was ARK Invest updating its Ethereum spot ETF profile on the evening of February 7, discussing the potential use of ETH in their fund for profitable staking.

Other top altcoins in the market are also seeing gains ranging from 2% to 5% at the current time.

In the past 12 hours, over $80 million USD worth of derivative contracts have been liquidated in the market, with shorts comprising over 90%.

Market liquidation status in the cryptocurrency market as of 09:50 AM on 08/02/2024. Source: CoinGlass