Bitcoin nears $62,000, sparking retail buying frenzy

abdelaziz Fathi

Bitcoin dashed past the $61,000 barrier on Wednesday, a peak it hadn’t touched since the waning days of November 2021.

The crypto giant, which holds the crown for the largest market cap in the cryptocurrency world, saw a spike of over 7% in just 24 hours, soaring to $61,200 by the early US hours.

This bullish run triggered a domino effect, liquidating upwards of $100 million in Bitcoin positions, with a hefty $72 million of that in shorts. Since the month kicked off, Bitcoin has jumped by nearly 45% increase. Its market dominance now sits comfortably at 50.3%, leaving ether trailing with a 17.2% share.

Not to be outdone, BlackRock’s iShares Bitcoin ETF (IBIT) bagged a record single-day inflow of $520 million this Tuesday, dwarfing the previous day’s $111.8 million. This influx was a solid 5% bump over the last high of $493.1 million recorded on February 13, beating the $519.8 million combined total for all U.S. spot Bitcoin ETFs the day before.

The appetite for spot Bitcoin ETFs has hit a multi-week peak, with total net inflows since their January 11 debut reaching $6.7 billion.

With April’s much-anticipated halving event on the horizon, Bitcoin miners are ramping up their accumulation, Tuesday’s K33 market report shows. Over the last three months, publicly traded mining outfits have hoarded an estimated 29% of all Bitcoin rewards, a significant jump from the 2.5% average seen from January through November.

This uptick in miner retention is likely fueled by a mix of rising Bitcoin prices and a strategic pause in sales to brace for the post-halving dip in rewards. Historically, Bitcoin has enjoyed a rally leading up to the halving, only to enter a period of consolidation afterward. K33’s analysis shows that, on average, Bitcoin has secured a 30% return in the 50 days preceding past halvings, followed by a more subdued 3% post-halving gain.

Another catalyst propelling Bitcoin’s current surge could be the growing buzz among retail investors. According to Ryze Labs analysts, Coinbase’s recent filings unveiled a slump in trading volumes in Q3 2023, but the narrative has since shifted. The resurgence in retail activity, especially from sectors like gaming, NFTs, and social platforms, has sparked a notable uptick.

Data from Coinbase corroborates this trend, showing a rebound in both trading volume and retail engagement from Q3 to Q4 2023, reversing a prolonged downtrend. This resurgence in retail interest may very well be a key driver in the ongoing rally, painting a vibrant picture of the crypto landscape as we march further into the year.

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