Bitcoin Price Surge: $105K Target?
Bitcoin Price Rises Amidst Regulatory Shifts
Bitcoin (BTC) experienced an 8% price increase from its March 11th low of $76,703. This surge is largely attributed to substantial institutional investment, with leveraged buying significantly impacting the market.
Bitfinex witnessed a surge in margin longs, reaching their highest point since November 2024. This represents a $5.7 billion bullish bet on Bitcoin's potential, despite recent price volatility. The addition of 13,787 BTC over 17 days underscores this strong sentiment.
Bitcoin/USD (orange, left) vs. Bitfinex BTC margin longs (right). Source: TradingView / Cointelegraph
Correlation Between Money Supply and Bitcoin Price
Analysts suggest a strong correlation between Bitcoin's price and the global monetary base. Increased liquidity injected by central banks, often in response to recessionary pressures, could drive Bitcoin's price higher.
This theory is supported by claims of an 82% correlation between the global money supply (M2) and Bitcoin's price, as noted by Twitter user Pakpakchicken (@pakpakchicken). This suggests that as central banks ease monetary policies, investor interest in Bitcoin could increase, potentially propelling the price above $105,000 within the next two months.
Source: pakpakchicken
Impact of Macroeconomic Factors and Regulatory Uncertainty
While the correlation between money supply and Bitcoin price is compelling, other factors also play a significant role. For instance, Donald Trump's potential involvement with Binance, as reported by the Wall Street Journal, adds another layer of complexity.
The regulatory landscape in the US remains unclear. The OCC's stance on bank custody of digital assets and the SEC's ongoing review of spot Bitcoin ETF applications create uncertainty. The SEC is also considering removing crypto-specific provisions from a proposed rule expanding exchange definitions. These factors, combined with the current macroeconomic climate, present both challenges and opportunities.
Spot Bitcoin ETF net flows, USD. Source: CoinGlass
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Conclusion
The potential for Bitcoin to reach $105,000 is a complex equation. While macroeconomic factors and increased liquidity may contribute, regulatory developments and market-specific events will likely play a significant role. This underscores the importance of informed decision-making and strategic planning within the blockchain space.
Disclaimer: This article is for informational purposes only and does not constitute financial advice.