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Bitcoin Hits $63K, Highest Since 2021

Bitcoin Hits $63K, Highest Since 2021

Bitcoin or BTC—the world’s largest cryptocurrency was hovering around the levels of $63,734 on Wednesday at around 10:45 PM IST for the first time since Nov. 2021. It has surprisingly surged to $63,000 levels with a market capitalization of $1.23 trillion, BTC has risen nearly 8.88% in the last 24 hours as of Feb. 29, 2024. At the time of writing the BTC is at $62,554 and has exhibited an outstanding recovery through 2023. 

The cryptocurrency’s Fear and Greed Index is in the zone of extreme greed, with a four-year high value of 82 days. Bitcoin prices have skyrocketed to $63,000, 8.53% shy of $68,789, its all-time high of 27 months ago. Bitcoin has hit $63,000 even before the most-awaited Bitcoin Halving event that is expected to take the cryptocurrency to unprecedented heights. 

Bitcoin Price Hits 2-year High of $63,000

The Bitcoin price hits $63,000 after two-year and the rise is provoked by the blooming interest in spot Bitcoin ETFs. According to the Farside Investors data, the ETFs have soared to an excellent level of $6.7 billion since the Securities and Exchange Commission gave the approval to them at the beginning of the year. These Bitcoin ETFs on average are alluring a daily inflow of around $210 million. 

In the last few months, the surge has been triggered by institutional allocation and also increased retail participation due to spot Bitcoin ETF application in the U.S. and of course the upcoming Bitcoin Halving. Meantime, the surge coexists with a broader rally in the cryptocurrency market. ETH, too, has touched the level of $3,421, increasing by 16.90% in seven days.  

How Does the $520 Million Inflow into Bitcoin ETFs Affect Bitcoin’s Price?

The week started off brilliantly for Bitcoin ETFs as they recorded an inflow of $520 million on Monday and increased to $577 million on Tuesday, in a day almost increasing by 10.96%. This massive inflow came because of the BlackRock iShares – ETF witnessing an inflow of $520 million alone, and boom the BTC has touched the $63,000 level already before Bitcoin halving and soon will surpass its all-time high. 

According to the BitMEX research data, the BlackRock iShare ETF is currently leading the Spot Bitcoin ETF inflow which witnessed a  net inflow of $577 million yesterday and it alone has $520 million. Until launch, this happens to be the third-largest inflow, as all the nine spot Bitcoin ETFs gained huge trading volumes. The net inflow of the ETF hit over $6.5 billion and asset holdings hovered over 1,41,000 BTC. Fidelity Bitcoin ETF witnessed $126 million and Ark 21Shares a net inflow of $5.4 million. Other Spot ETFs also saw solid inflows, showcasing strong bullish sentiment among both institutional and retail investors. 

On the other hand, Grayscale’s GBTC witnessed a $125.6 million outflow, an increase from Monday’s $22.4 million outflow, giving up hopes of a standard shift. 

$268 Million Worth Of Short Positions Liquidated Over Last 24 Hours

Bitcoin’s huge surge upward witnessed $268 million plus in shorts liquidated throughout the extensive crypto market. After Bitcoin skyrocketed to the $59,301 level, upward by nearly 11%, its short sellers are nursing millions in losses. According to CoinGlass, in the last 24 hours, over $161 million in BTC shorts were liquidated. 

As BTC precisely touched $57,000, in total $270 million-plus in short positions were liquidated as the market rises. The cryptocurrency market is witnessing a massive surge in BTC prices which rose from $57,000 to $60,000 in less than 24 hours. As of Feb. 29, 2024, the price is at $62,502 and has increased by 48.46% from the last month. 

BTC Hitting $63,000 – Is This a Sign of a Bull Run or a Bull Trap?

The surge in Bitcoin prices and its hitting $63,000 after two years is a sign of a bull run or a bull trap, investors should be cautious. Bitcoin is trading tremendously well, some traders think it’s a bull trap and some have an optimistic approach towards the BTC surge. 

The cryptocurrency market is doing excellently, but investors need to be careful as sudden pumps can also be a possibility of a bull trap. There are many reasons for the BTC to surge even more and set a new all-time high record. Some of the reasons are Spot Bitcoin ETFs, Bitcoin Halving and ETH Dencun upgrade. 

The last time the BTC price was above $57,000 was in the year 2021, when the price peaked and was beginning its reversal into a prolonged bear market. By the start of the year 2022, the price had sunk to $32,987, almost a 42% decline. The current market shows the same similarities and thus can be a bull trap. Forbes Advisor India suggests investors be careful while trading in BTC.

Bottom Line

The overexcitement around the U.S. approval of a Bitcoin futures ETF has hyped optimism across the crypto industry. This has extensively opened the doors for institutional investors to kick off into the BTC bandwagon, driving the prices and demand. 

This is a good opportunity for investors to take advantage of the Bitcoin surge as it is likely to rise driven by the Bitcoin halving event and the ETH Dencun upgrade but only with extreme caution. As we all know the crypto market is highly unpredictable and history testifies BTC is utterly volatile with past price movements reflecting BTC prices falling more than a third in value. The current surge could just be a conceited bull trap, no one can tell. 

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