Bitcoin jumps 9% to flirt with all-time highs; what's driving this crypto market rally?

Bitcoin continued its rally to rally another 9 per cent to near its all-time high levels. However, the largest crypto asset did not climb to new record levels, but the industry watchers believe that new highs are on the cards amid the renewed interest in the digital token as an asset class.

According to the Coinmarketcap, Bitcoin gained more than 9 per cent to scale $68,785.95 in the last 24 hours, just 2 per cent away from it's all time high at $68,789.63, it scaled on November 10, 2021. The total market capitalization of Bitcoin crossed 1.33 trillion mark.

Currently, trading just below $68,000, Bitcoin neared its all-time highs in the last 24 hours as institutional participation via spot BTC ETFs and the investor’s anticipation ahead of BTC halving seem to be the key drivers for BTC’s price performance, said Parth Chaturvedi, Investments Lead at CoinSwitch Ventures.

"With the halving still underway, we may get to see Bitcoin prices go even higher and hit new record levels before retracing and continuing its rise," said Chaturvedi. However, with the rise of the crypto market comes retail FOMO, which may have induced speculative buying, he cautioned.

The total global crypto market capitalization has risen about 5.5 per cent to top the $2.5 trillion mark. The total crypto market volume over the last 24 hours is $196.11 billion, registering a rise of 77.24 per cent in the period. Bitcoin’s dominance increased 0.27 per cent and is now currently at 52.59 per cent.

Bitcoin has surged more than 50 per cent in the last one month, which has rallied over 150 per cent in the last six months. The largest crypto asset surged by over more than 20 per cent in the previous week.

Bitcoin achieved another significant milestone. The market sentiment is positive amid the obvious and known reasons- institutional demand, the growth of spot Bitcoin ETFs, and the upcoming halving event, said Edul Patel, CEO at Mudrex. "Bitcoin is on track to surpass its all-time high anytime now," he said.

According to the data from Bloomberg, spot BTC ETFs recorded their second-strongest daily volume yesterday with $5.5 billion worth of shares traded. BlackRock’s IBIT ETF hosted $2.4 billion worth of volume alone, with its AUM climbing to $11 billion.

There has been a 5 per cent year-to-date increase in the number of whales holding at least 1,000 Bitcoins, suggests an IntoTheBlock study. Furthermore, 97 per cent of all Bitcoin addresses are currently in a profitable state, showcasing a surge in demand.

The market is witnessing a notable resurgence, with Bitcoin's price reaching its record highs, accompanied by a significant influx of institutional investment, which are the primary catalysts for this upward trend, said Sumit Gupta, co-founder at CoinDCX.

"While meme coins are experiencing a transient upswing fueled by FOMO, the true drivers of this rally remain established players like Bitcoin and Ethereum, which are attracting robust demand from major investors," he said. "Institutional adoption is playing a pivotal role in propelling the current crypto rally."

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