Bitcoin Reaches $107,000 on Institutional Demand, Despite US Credit Downgrade

QCP's daily market observation highlighted the increasing macro uncertainty, with the US stock market under pressure and the Federal Reserve maintaining a cautious stance. The US credit rating was also downgraded, adding to the fiscal fragility highlighted by Washington. Despite these challenges, Bitcoin demonstrated resilience, briefly reaching $107,000 on Sunday. This initial uptrend was likely triggered by Metaplanet's announcement of a $104 million Bitcoin purchase, with Strategy Inc also increasing its holdings. However, the BTC perpetual contract funding rate surged, prompting traders to close their positions for profits and leading to the liquidation of some high-leverage long positions.

Although BTC has retraced some of its gains during the Asian session, it remains within the recent consolidation range overall. This stability is supported by warming institutional demand, with spot Bitcoin ETFs continuing to attract inflows, demonstrating strong fundamental support. Notably, even amidst Moody's downgrade of the US credit rating and a stock market sentiment leaning towards "risk-off," BTC was still able to see gains over the weekend. This further strengthens its positioning as a "store of value" tool, a narrative gaining more consensus and expected to become a long-term bullish catalyst.

The broader crypto market narrative is also heating up. Coinbase is set to officially join the S&P 500 index, carrying symbolic significance and representing an increase in mainstream acceptance and institutional credibility. This news comes at an opportune time, especially after its strategic acquisition of Deribit. The volatility market also reflects the market's optimistic sentiment. Despite the consolidation of spot prices and lingering macro uncertainty, the implied volatility of crypto assets remains relatively high. The call skew structure of Bitcoin options remains stable across most tenors, implying that the market overall still maintains a structurally bullish expectation.