- BTC Futures market eased as the spot market remained dominant.
- Will BTC climb higher amid unprecedented demand in the spot market?
The Bitcoin [BTC] Futures has slowed down while the demand from the spot market has remained strong, a trend that could push the digital asset’s value higher.
According to pseudonymous CryptoQuant analyst Avocado, BTC Futures bounced back in September 2024 but fizzled later in earlier December.
This meant reduced leverage, one of the signals of speculative froth and overheating, a welcome scenario for BTC’s upside potential.
He said,
“There are no visible signs of late-cycle overheating. This indicates that Bitcoin’s upward trajectory is likely to continue, with significant room for further growth.”
Source: CryptoQuant
Healthy BTC market
Apart from a short-term caution from the macro front amid sticky US inflation that could derail the Fed rate path, funding rates were healthy.
For context, funding rates measure market sentiment and by extension the level of leverage and liquidation risks.
Source: CryptoQuant
That said, the funding rates hit March levels, but the liquidation cascade on the 5th of December triggered a reset to a healthy level. Elevated funding rates in March, marked the local top. So, the current levels could allow the BTC to soar higher.
On top of that, there’s strong spot market demand from US spot ETFs and companies with BTC treasuries like MicroStrategy and Marathon Digital.
According to CoinShares data, capital inflows to crypto investment products hit $44.5 billion on year-to-date (YTD), dominated by BTC.
Source: CoinShares
To put this into perspective, since the US elections in November, BTC products have attracted $11.5 billion in inflows.
If the strong spot market demand continues, the cryptocurrency’s value could explode.
So how far can the value go from here?
Based on the Fib trend tool and measured from the bottom of the 2022 crypto winter, the recent high of $108K coincided with the 1.618 Fib level.
Read Bitcoin [BTC] Price Prediction 2024-2025
The next Fib target is $165K, although most analysts expect a $120K-$200K price target for this cycle top.
Source: BTC/USDT, TradingView
