Bitcoin Smashes $100,000: ETF Inflows and Record Derivatives Open Interest back Historic Rally

Bitcoin is finally a six-figure asset following its latest push above the highly anticipated $100,000 price tag. The road to this milestone has been quite interesting this week, underpinned by a mix of robust spot and derivatives demand.

November has been one of the most bullish months for Bitcoin and this clearly paid off. It will go down in history as the month that Bitcoin crossed above the $100,000 price tag for the first time in history. It exchanged hands at (INSERT PRICE) at press time.

BTCs price action has so far rallied by (INSERT PERCENTAGE) from its lowest price to its recent high. This performance indicates that November could possibly become the most bullish month for Bitcoin in 2024. However, that will only happen if it pushes higher to overtake the 52% upside it achieved in February.

Bitcoin ETFs underpin strong demand in the spot market

We previously observed that Bitcoin ETFs have been influencing the market‘s direction. They have also been aggressively accumulating this week. However, the latest ETFs data was noteworthy because the daily volume purchased during Thursday’s trading session.

The Bitcoin ETF inflows reportedly surpassed the $1 billion mark during Thursdays trading session. Daily ETF inflows averaged over $600 million in the last 3 days.

bitcoin | source x

The massive Bitcoin ETF inflows align with the strong demand for Bitcoin that was observed in the last 7 days. They particularly demonstrated the level of demand in the spot market. This demand contributed to the successive new highs we observed in BTC price action during the week.

Bitcoin open interest soars to historic high

Bitcoins ATH price action above $100,000 was not only aided by spot demand but also a surge in derivatives demand. According to Coinglass, the level of BTC open interest surged above $60 billion for the first time in the last 24 hours.

Bitcoin futures open interest on exchanges Source: Coinglass

The level of open interest on exchanges peaked at $64.24 billion at the time of observation. This was the highest level of exchange-related open interest that the cryptocurrency has achieved in its entire history.

The surge in open interest was a reflection of the massive demand in BTC derivatives. But, open interest is a double edged sword, hence necessitating an assessment of longs vs shorts. The ratio of longs vs shorts shifted slightly in favor of the bears in the last 24 hours.

For context, shorts were higher at 50.7% at the time of writing while longs were slightly lower at 49.3%. A pivot from the situation the previous day during which longs were higher at 51.01%, and shorts covered 48.99%. This shift was a potential sign that the market anticipated a bearish move during the weekend.

Bitcoin longs vs shorts ratio Source: Coinglass

Will Bitcoin hold on to price levels above $100,000？ This is the biggest question so far but the answer depends on whether profit-taking will intensify at recent highs. This could result in a pullback below the $100,000 level.

On the other hand, 2025 is just around the corner and bullish optimism may remain in anticipation of even higher prices. Such an outcome could lead to more demand for BTC and potentially more price discovery in 2025.

Nevertheless, massive pullbacks are expected at some point even if prices will reach higher. The future is full of uncertainty and there‘s no telling how the dice will roll. Traders should therefore be on the lookout for catalysts as well as black swan events that could determine Bitcoin’s fate in the coming months.