- Bitcoin’s bullish rally resulted in a 13.27% jump in value week-on-week.
- BTC’s spot market activity was being powered by the U.S. market, with Coinbase taking the lead.
Fueled by institutional interest in cryptocurrencies, Bitcoin [BTC] briefly hit yearly highs of $31,000 last week. The bullish rally, catalyzed by TradFi giant BlackRock’s application for a spot Bitcoin Exchange-Traded Fund (ETF), resulted in a 13.27% jump in the king coin’s value week-on-week, as per CoinMarketCap.
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Futures market powering the rally?
According to crypto market data provider Kaiko, the rally was getting impetus from derivatives markets. The Open Interest (OI), or the dollar value locked in BTC futures contracts, hit its yearly peak recently while OI denominated in BTC touched its highest level since January 2023.
An increase in price complimented by an increase in OI indicated a higher capital inflow into the BTC market and increased speculative interest.
Moreover, as prices rose, many short-position traders, who were anticipating price drops, covered their positions to limit their losses. This drove BTC’s price further.
Source: Kaiko
This was also reflected in the surge in short liquidations over the last week, according to Coinglass. At the time of writing, shorts worth more than $3 million were liquidated over the last 24-hour period.
Source: Coinglass
U.S. driving spot market activity
Despite significant interest in the derivatives market, Kaiko ruled out its dominance in powering BTC’s recent rally. This was because BTC’s spot to futures volume ratio has been constant over the course of the last three months with no notable spikes and declines.
Source: Kaiko
Spot volume is the buying and selling of assets at the prevailing market price. Kaiko noted that the ratio of Binance to Coinbase spot BTC volume has dipped sharply since the U.S. Securities and Exchange Commission (SEC) lawsuit on the two crypto behemoths.
Thus, BTC volumes on Coinbase were growing faster than that of Binance.
How much are 1,10,100 BTCs worth today?
As Coinbase is primarily used in the American market, it could be inferred that spot trading activity was driven by the U.S.
Big institutional players’ interest has fueled expectations of a BTC bull run, as market sentiment has shifted significantly from ‘neutral’ to ‘greed’. At the time of writing, BTC exchanged hands at $30,379.55.
