Biden's "laser eye" ignites the crypto community, and Bitcoin climbs to $50,000

At the beginning of the Chinese New Year, Bitcoin led the crypto market and brought us a "good start" for the Year of the Dragon. BTC, the largest cryptocurrency by market value , broke through US$50,000 in a short period of time, reaching its highest level since December 2021 .

The share prices of crypto-related companies have been soaring. As of the close of U.S. stocks on Monday, MicroStrategy rose 11%, trading platform Coinbase rose 4%, and mining company Marathon Digital rose 14%.

Biden's "laser eye" speculation

Coincidentally, yesterday US President Biden posted a tweet with laser eyes on his X account, with the caption "Just like we drew it up", which instantly sparked heated discussions in the crypto community. After all, in the eyes of crypto enthusiasts, laser eyes represent firm support for Bitcoin (Hold).

However, the real intention of the tweet seems to have nothing to do with encryption. Media website Mashable analyzed that the tweet was posted after the Kansas City Chiefs defended the Super Bowl title on Sunday. It was actually the "Dark Brandon" meme that became popular as early as 2021. Biden quoted it again, which seemed to be a satire on the right-wing conspiracy theory about the Super Bowl and Taylor Swift. Some previous remarks claimed that this Super Bowl was rigged to ensure the victory of the Kansas City Chiefs, where Taylor's current boyfriend Travis Kelce is, and thus became a public relations tool for Biden's re-election campaign.

It doesn’t matter what the meaning behind Biden’s emoticons is. For the crypto market, which operates 24/7, what is most needed is celebrity hype.

Bankless retweeted and hinted at the potential impact on the ETH/BTC trend. The anonymous X account WhalePanda said it was a kind of crypto cultural export. Even Tron founder Justin Sun joined in the speculation, reposting the comment: "Bitcoin?"

Grayscale selling pressure decreases, ETF net inflow surges

Bitcoin's rise has benefited from the good performance of US spot ETFs. Last month, the United States approved ETFs that can directly hold Bitcoin. This optimism is prompting more people to accept Bitcoin, thus driving the rise.

Last week, U.S. spot Bitcoin ETFs saw net inflows of $1.1 billion, CoinShares reported. Since the funds launched, $2.8 billion has flowed in.

The assets under management of global crypto investment products reached their highest level since early 2022, at approximately US$59 billion.

Last week, Fidelity's Bitcoin ETF reached $3 billion in assets under management, making it the second similar product to achieve this milestone after BlackRock .

The outflows mainly came from Grayscale's GBTC , an ETF converted from the company's Bitcoin Trust. Last week, GBTC saw outflows of $415 million, and the previous week's outflows were as high as $900 million.

Greg Moritz, co-founder of cryptocurrency hedge fund AltTab Capital, said the slump of the past few weeks was largely due to outflows from Grayscale, but now those outflows have slowed and net inflows are picking up.

CoinShares data shows that as of last Friday, newly launched spot Bitcoin ETFs (excluding Grayscale 's GBTC) held more than 192,000 BTC, surpassing MicroStrategy's 190,000 BTC, with inflows exceeding $1 billion in less than a month.

Bitfinex analysts said in a report that the "sell the news" price drop expected by some investors after multiple spot Bitcoin ETFs were approved in January was not as severe as expected.

“Bitcoin is now on track to set new year-to-date highs, with this uptrend coinciding with a period of declining GBTC outflows and generally increasing inflows into digital asset funds,” the analysts said.

The bull market has just begun?

In November 2021, the price of Bitcoin peaked at about $69,000. 2022 was a disaster, with the Terra ecosystem collapsing, the cryptocurrency exchange FTX and other large and small projects going bankrupt, and Bitcoin closing at just over $16,000 in 2022, down about 75% from its all-time high. The trend of falling prices, closing projects or cutting operations continued into 2023. In the last three months of 2023, as the SEC 's attitude toward spot ETFs became clear, the price of Bitcoin rose by nearly 60%, breaking through $42,000 at the end of the year.

Multiple positive factors in 2024 make analysts optimistic about the long-term trend.

The continued adoption of a Bitcoin ETF could significantly absorb selling pressure, potentially reshaping Bitcoin's market structure by providing a new, stable source of demand, which is positive for prices.

In addition to the Bitcoin ETF, the halving will also take place in April. The reward per block will drop from 6.25 Bitcoin to 3.125 Bitcoin. The last halving occurred in 2020.

Bitfinex analysts said that the dynamics of long-term Bitcoin holders indicate a bullish market outlook: "ETF inflows, coupled with the upcoming 2024 Bitcoin halving and continued high levels of illiquid supply, with more than 70% of Bitcoin in the hands of long-term holders, paint an exceptionally bullish picture for BTC price action."

The analysts added: “Realized price indicators across various investor groups continue to suggest that we are still in the early stages of a bull market. These indicators suggest that the long-term trajectory this year should see prices trend upward.”

In addition to ETF inflows, sentiment toward bitcoin has been “generally positive” during the ongoing Lunar New Year holiday in Asia, Fundstrat Global Advisors wrote in a report.

“Enthusiastic buyers bring more enthusiastic buyers, driving prices further up,” said Fadi Aboualfa, head of research at cryptocurrency custodian Copper Technologies Ltd.

Traders' attention remains focused on the macroeconomic situation. U.S. inflation consumer price index data will be released tomorrow, which will guide the Fed's interest rate path. According to CME's "Fed Watch" data, the probability of the Fed keeping interest rates unchanged in March is 84.5%, and the probability of a 25 basis point rate cut is 15.5%.

As of press time, the price of Bitcoin is just below $50,000, with a 24-hour increase of 3.39%.