The God of Wealth appears! Bitcoin hits $52,000, a 25-month high

On the fifth day of the first lunar month, the Chinese people have the custom of "welcoming the God of Wealth", and crypto investors can be said to be "seeking wealth and getting wealth". In the past 24 hours, Bitcoin has climbed above US$51,000 for the first time since December 2021, with a market value of US$1 trillion. The intraday high reached US$52,079, a 25-month high.

Ethereum, the second-largest cryptocurrency by market cap, rose 5% to $2,786, reaching its highest level since May 2022 and was still rising at press time. Other altcoins also rebounded, with ADA and DOGE up 6%, and the total cryptocurrency market cap hit $2 trillion for the first time since April 2022.

Spot ETFs support optimism, options data points to $75,000

Large inflows into U.S.-listed spot Bitcoin ETFs supported the positive sentiment, with BlackRock ’s IBIT experiencing nearly $500 million in net inflows on Tuesday, while outflows from the existing Grayscale Bitcoin Trust ( GBTC ) gradually slowed.

“Yesterday we saw $651 million of inflows, which was the largest single-day inflow since launch day,” said James Butterfill , head of research at cryptocurrency-focused asset manager CoinShares .

According to data provider CryptoQuant , about $9.5 billion in new money has entered the Bitcoin market through these funds since trading began on January 11. In the past two weeks, more than 71% of the new funds invested in Bitcoin came from spot ETFs, which do not include GBTC.

The broader market’s gains come as bullish sentiment around Bitcoin continues to rise, with a number of $65,000, $70,000 and $75,000 call options appearing on major crypto options exchange Deribit .

Deribit is the world's leading crypto options exchange by trading volume and open interest. On Deribit, one options contract represents 1 BTC. Call options give investors the right to buy the underlying asset at a specific price before a specified date, while put options give investors the right to sell.

Heavy buying of higher-strike call options reflects bullish sentiment among experienced market participants.

Positioning in the options market has been a reliable indicator of upcoming price action, as explained by Kelly Greer, Galaxy’s head of sales for the Americas: “We are seeing open interest concentrated in the $50,000 call, and we are seeing $50,000, $60,000, and $75,000 call contracts in the April-June expiration markets. These flows indicate that buyers are willing to pay a premium to acquire these positions, which suggests that investors are constructive on Bitcoin.”

The cryptocurrency’s 14-day relative strength index, a technical analysis tool, jumped above 70, indicating overbought conditions in the Bitcoin market. Overbought readings are often seen as a sign that a bearish trend is about to reverse, although it simply means that the market has risen too fast in the short term and may be taking a breather.

“Bitcoin has been rising for several days in a row, but the rally slowed over the weekend. At the same time, the daily RSI broke through 70, which may increase the probability of players taking profits in the short term,” said Alex Kuptsikevich, senior analyst at FxPro, in a report.

In addition, a potential source of selling pressure is that the court approved the bankrupt Genesis to sell its $1.3 billion GBTC holdings today. The judge said he would agree to Genesis' request to convert the shares into Bitcoin or cash, a process the crypto lender said would take place over time with the help of brokers.

According to documents from early February, Genesis owns 35 million shares of GBTC, 8 million shares of ETHE, and about $3 million in ETCG.

Spot Ethereum ETF Approval Entering Countdown?

Analysis platform Layergg released a report saying that the countdown to the "expected approval" of the Ethereum spot ETF has entered 100 days, and the crypto market seems to be ready for major developments and price changes.

According to the platform’s analysis, in the first phase, Ethereum’s Dencun upgrade, scheduled for March 13, could spur a rally. Layergg predicts that Ethereum’s value could surge, similar to the 50% gain witnessed during last year’s Shanghai upgrade.

In phase 1.5, Layergg highlighted the indirect support of the upcoming Bitcoin halving, which has historically driven a 70% increase in BTC prices. The surge in Bitcoin prices will also help sustain Ethereum’s gains.

In the second phase, Layergg introduced key decision dates for seven Ethereum ETFs (expected by Bloomberg analysts to arrive on May 23). Similar to the launch of the Bitcoin ETF, Layergg said Ethereum could rise by 80% in the months leading up to the decision.

However, Layergg stressed that market corrections are inevitable. FUD (fear, uncertainty, doubt) surrounding Celsius/Genesis selling pressure, SEC regulations, and Grayscale Ethereum Trust conversion could trigger market volatility.

Crypto analyst RAKESH UPADHYAY speculated from the technical trend of the daily chart that Ethereum bulls pushed the price above the $2,717 resistance level on February 14, marking the resumption of the uptrend. If the bulls maintain the breakthrough, ETH/USDT may soar to the important psychological level of $3,000, which may see short-term traders profit-taking. If the bears take advantage, ETH may fall to the 20-day moving average level (about $2,462) in the short term.