Bitcoin is signaling the start of a new bullish trend, recovering to $42.6 thousand after a recent sell-off primarily driven by short-term holders (STH) who are more speculative in their Bitcoin investments. Ether has also experienced a price increase, surpassing the $2,270 mark.
In this context, a significant influx of capital into Bitcoin and Ether has been observed, which could further influence the price trajectory of these leading assets.
According to the renowned on-chain analyst Ali Martinez, December 14 witnessed an inflow of more than $19.7 billion into Bitcoin and Ethereum. This figure brings to mind a similar influx observed three years ago, just before Bitcoin surged from $18,000 to $65,000.
If historical patterns repeat, Bitcoin may follow a similar trajectory to the 2020 cycle, reaching new all-time highs.
Furthermore, Greek.live revealed that BTC options have gained prominence in the midst of the recent price rally, accounting for 50% of the total options volume.
Contributing to the recent optimistic Bitcoin price predictions, another market commentator speculated that the asset is expected to surpass the range of $42,000 to $45,000 in the coming week. After this point, there are no significant barriers expected until reaching $63,000.
Bitcoin’s strong recovery has been temporarily halted as short-term holders sold off their holdings to secure profits. This led to the third significant sell-off event in 2023. Analysis by Glassnode indicates that the leading cryptocurrency quickly depleted after reaching its yearly high of $44.5 thousand.
However, the BTC supply on cryptocurrency exchanges shrinking reflects the investor sentiment of holding onto assets and reducing the willingness to sell.
Meanwhile, Arthur Hayes, the former CEO of BitMEX, reiterated his previous prediction that Bitcoin will eventually reach $1 million. He believes this is due to larger economic changes eroding the value of national fiat currencies.