Bitcoin Surges 20% to $91,700 as Institutional Interest Grows
2min read Bitcoin holders are experiencing a resurgence in profitability as new capital flows into the market, sparking speculation about the potential for the cryptocurrency to reach a $100,000 price point. This renewed interest comes amidst a broader shift in global financial markets, where investors are increasingly turning to alternative assets like gold and Bitcoin as traditional safe havens.
The recent surge in Bitcoin's price, which has exceeded $90,000 for the first time since March 7, is driven by a combination of factors. One significant driver is the growing distrust in traditional financial systems, particularly in the wake of economic uncertainties and geopolitical tensions. Investors are seeking refuge in assets that are perceived as more stable and less susceptible to the volatility of traditional markets. Bitcoin, with its decentralized nature and limited supply, is increasingly seen as a viable alternative to gold and other traditional safe havens.
The influx of new capital into the Bitcoin market is also a result of regulatory clarity and institutional adoption. As regulatory frameworks become more defined, institutional investors are becoming more comfortable with the idea of allocating a portion of their portfolios to Bitcoin. This institutional interest is further bolstered by the growing acceptance of Bitcoin by major corporations and financial institutions, which are beginning to recognize its potential as a store of value and a hedge against inflation.
Bitcoin’s surge above $91,700 on April 22 pushed its value above the short-term realized price or cost basis. This implies that a majority of short-term holders (STHs) are currently back in profit. STHs returning to profit after unrealized losses signal a bullish outlook, paving the way for a potential $100,000 retest. Historically, during the early phase of a rally, STHs in profit provided upward momentum by holding firm and drawing in new investors. Bitcoin’s supply mapping indicated “strong activity” in April from first-time buyers, indicating fresh capital injections in the market at higher prices.
Long-term holders (those holding for more than 155 days) increased their allocation by 363,000 BTC since February, while Bitcoin whales and sharks have absorbed 300% of the yearly issuance. Despite this week’s price breakout, Bitcoin researcher Axel Adler Jr. noted that the last strong resistance remains at $96,100. In an X post, the analyst said, “At the $96K level, there will be the final resistance from the cohort holding coins for 3-6 months, after which the next target of $100K opens up.”
According to Bitcoin’s cost basis distribution data, investors hold approximately 392,000 BTC at an average cost basis of $97,000, creating a potential resistance zone. This concentration suggests many investors may sell at break-even, potentially stalling Bitcoin’s upward momentum. However, anonymous trader Ezy Bitcoin emphasized Bitcoin's price action in the Wyckoff reaccumulation phase is “playing out beautifully”. The chart indicated continued strength, with three price targets: $131,500 (target 1), $144,900 (target 2), and $166,700 (target 3). This Wyckoff pattern points to possible accumulation by large players, signaling an upward trend for Bitcoin, as the market absorbs supply and prepares for an uptrend.
The potential for Bitcoin to reach $100,000 is a topic of much debate among analysts. While some predict that the cryptocurrency could surpass this milestone in the near future, others remain cautious, citing the inherent volatility of the market and the potential for regulatory changes to impact its price. However, the current trend of institutional adoption and the growing acceptance of Bitcoin as a legitimate asset class suggest that the cryptocurrency is well-positioned to continue its upward trajectory.
The recent price surge has also been accompanied by a shift in market sentiment, with investors becoming more optimistic about the future of Bitcoin. This optimism is reflected in the increasing number of Bitcoin holders who are now in profit, as well as the growing interest in the cryptocurrency from both retail and institutional investors. As the market continues to evolve, it remains to be seen whether Bitcoin will be able to sustain its current momentum and reach the $100,000 price point. However, the current trends suggest that the cryptocurrency is well-positioned to continue its upward trajectory in the coming months and years.
