Bitcoin reached $61,000 early on Tuesday, bouncing back from its fall at the beginning of August, according to an early report covered by Yahoo News.
Within the last 24 hours, BTC has seen more than a 4% price rise, outperforming the wider cryptocurrency market whose increase stands at just above 2%.
Even with these gains, there is some caution amongst certain trading funds in terms of inflation and ahead of the looming US Fed monetary policy announcement. Some warn of the possibility of short-term tremors capable of impeding the Bitcoin rally.
In a Telegram broadcast, for example, QCP, a cryptocurrency trading company, revealed that “Investors remain cautious ahead of US CPI this week.
They will closely watch inflation numbers for guidance on whether the Fed will cut rates by 50 or 25 bps in September. The odds are now evenly split.”
Early August Decline
On August 1 2024, the price of Bitcoin fell sharply by over $1,600 within just one hour (from $64,000 to $62,800).
One consequence of this decline was a significant disruption for long traders, with the BTC/USD pair falling to a two-week low of $62,212.
There were also significant liquidations amounting to $337 million within 24 hours (including $77.07 million in long Bitcoin positions).
The last four hours alone saw a liquidation of $26.6 million. The most notable liquidation was at the OKX – a $4 million ETH-USDT swap.
Election Effect
Crypto traders speculating on the likely impact of the U.S. election on the digital assets industry have decided to lock up millions in Bitcoin options related to the election. Trading on the election expiry options commenced on Deribit one month ago.
According to Amberdata, the notional open interest, or the value of the number of active options contracts in dollars stood at $345.83 million.
Call options, a source of unlimited upside payoff potential at the expense of limited loss, had a 67% share of the total open interest.
The remaining number was accounted for by put options, resulting in a less than 0.50 put-call ratio. That is, twice as many calls were open as puts, a reflection of the bullish expectations from the election’s outcome.
Bitcoin An Astonishing Success
Out of the 11 spot Bitcoin ETFs listed in the US, Goldman Sachs holds positions in seven of them (valued at over $400 million).
BlackRock’s IBIT which has a value of $238.6 million leads holdings. Mathew McDermott, global head of digital assets at Goldman Sachs, sees BTC ETFs as a significant psychological turning point for the industry, adding that they have been “an astonishing success.”
The above chart shows the percentage dominance of the BTC in the last 12 months.
Its present level above 57% is the highest since March 2021. This is a reflection of positive tailwinds, for example, the approval of ETFs.
