In a historic moment for cryptocurrency, Bitcoin broke through the significant $90,000 resistance mark, soaring past $93,000 on November 13, 2024. The surge is largely attributed to unprecedented demand from U.S. investors, who have increasingly sought exposure to Bitcoin through both direct purchases and exchange-traded funds (ETFs).

• Bitcoin shattered the $90K resistance on strong U.S. demand.

• BlackRock’s iShares Bitcoin ETF saw $1.2 billion in volume.

• Analysts forecast end-of-year prices ranging from $80K to $100K. PlanB forecasts Bitcoin price to touch $1 million by 2025. 

• Upcoming $11.8B options expiry in December could influence BTC’s trajectory.

Coinbase Premium Index — which tracks the price difference of Bitcoin on Coinbase versus offshore exchanges like Binance — spiked to its highest point since April, underscoring the heavy buying from U.S.-based investors. The premium index indicates that Bitcoin was trading at a higher price on U.S. exchanges, a sign that American traders, including institutional investors, are leading this rally.

The timing of the surge coincided with the opening of U.S. stock markets, highlighting that American investors are driving this latest price breakout. U.S. markets have been increasingly optimistic about Bitcoin as an investment, with high trading volumes reflecting their confidence.

Spot Bitcoin ETF flows | Source: TheBlock

The iShares Bitcoin Trust ETF by BlackRock has quickly become a favorite among institutional and traditional investors. On the day Bitcoin surpassed $90,000, BlackRock’s Bitcoin ETF recorded a trading volume of $1.2 billion within the first hour of U.S. markets opening. This made it the fourth most-traded ETF across all ETF products that day, illustrating significant interest from traditional finance sectors.

How ETFs Have Helped Drive Higher Institutional Interest in Bitcoin

BlackRock’s iShares Bitcoin ETF has sparked heightened interest in Bitcoin from large investors, reflecting growing trust and mainstream acceptance of the cryptocurrency. As a regulated and familiar investment vehicle, Bitcoin ETFs are particularly attractive to institutional investors who may be hesitant to enter the volatile crypto market directly. The surge in trading volume for BlackRock's ETF underscores this trend, as more risk-averse players gain Bitcoin exposure through structured, compliant products.

The involvement of BlackRock and other major institutions in Bitcoin ETFs marks a significant shift in Bitcoin's adoption. ETFs provide an accessible entry point, allowing institutions to invest in Bitcoin without dealing with the complexities of direct ownership. This framework appeals to pension funds, asset managers, and other institutional players by offering liquidity, transparency, and regulatory compliance. As ETFs shape Bitcoin's future as a mainstream asset, they open the door for broader acceptance among both retail and institutional investors alike.

Unlike rallies based on futures or other leveraged products, Bitcoin’s latest surge has been driven by spot buying. According to data on Bitcoin’s cumulative volume delta (CVD), the net buying pressure has been exceptionally strong. Each time the spot CVD shows a significant uptick, Bitcoin’s price tends to increase, suggesting that the current rally may be more sustainable than past surges based on speculative futures trading.

Spot trading reflects real purchases rather than derivative-based speculation, meaning buyers are directly acquiring Bitcoin rather than betting on its future price. This trend signals a healthier, demand-driven rise, which could be more resilient in the face of market volatility.

Wall Street Gains from Bitcoin Futures

BTC OI-weighted funding rate | Source: CoinGlass 

As Bitcoin’s price surges, Wall Street banks have also benefited. Reports indicate that banks have accrued approximately $1.4 billion in gains from Bitcoin futures, further demonstrating that traditional finance players are deeply invested in the asset’s success.

Banks have found a way to gain exposure to Bitcoin’s price without directly holding the asset. By trading Bitcoin futures and ETFs, they can leverage price movements and generate significant returns. This surge in institutional participation is indicative of a growing acceptance of Bitcoin as a legitimate asset class.

Bitcoin options open interest | Source: Cointelegraph

The significant open interest in Bitcoin options for December 27 creates a scenario in which price movement around that date could drive major market activity. With $11.8 billion at stake, bulls are hoping for a strong close above $90,000, while bears might aim for a lower price to make their put options profitable.

The aggregate open interest for this expiry has a significant tilt toward call (buy) options over puts (sell) options. The majority of calls have a strike price in the $90,000 to $100,000 range. If Bitcoin approaches this level as expiry nears, it could drive additional buying pressure. Conversely, a dip below $90,000 could offer short-term opportunities for bearish traders.

Read more: How to Trade Options on KuCoin: A Beginner’s Guide

Implications of the Options Imbalance

Currently, open interest for Bitcoin call options outpaces put options, with $7.9 billion in calls compared to $3.92 billion in puts. This large difference shows that more traders are betting on Bitcoin’s price increasing. The dominant position of call options could lead to a bullish scenario, especially if Bitcoin continues to stay above key levels as the expiry date approaches.

If Bitcoin remains near $88,000 at the time of the options expiry, it would render most put options irrelevant, putting bearish traders at a disadvantage. The December expiry could become a catalyst for a potential year-end rally, pushing Bitcoin toward, or even beyond, the $100,000 mark.

According to a report on Cointelegraph, several prominent analysts and market experts have shared their forecasts on where Bitcoin might end the year:

• Arthur Hayes (BitMEX): BitMEX co-founder Arthur Hayes envisions Bitcoin reaching $1 million, driven by expansive U.S. fiscal policies and potential regulatory changes under Trump. Hayes predicts that Trump's industrial subsidies and inflation-inducing policies, along with re-shoring efforts, will increase demand for Bitcoin as a hedge against currency devaluation, enabling Bitcoin to surpass all previous bull markets.

• PlanB: PlanB, the creator of the Bitcoin Stock-to-Flow model, predicts Bitcoin will hit $100,000 by the end of 2024 and could reach $500,000 to $1 million by 2025. He bases this on Bitcoin's scarcity, likening it to gold and real estate, which thrive in inflationary times. PlanB also sees more potential if Bitcoin is adopted as a national reserve asset, especially with pro-Bitcoin U.S. policies.

• Tony Sycamore (IG Markets): Expects Bitcoin to trade in the low-to-mid $90,000 range, anticipating a rotation toward altcoins in the near term.

• Josh Gilbert (eToro): Predicts Bitcoin hitting $100,000, driven by strong demand from institutional investors and positive macroeconomic trends.

• Ki Young Ju (CryptoQuant): Has a more cautious forecast, with an estimate of $58,974. He warns of potential corrections due to overheating in the derivatives market.

• Pav Hundal (SwyftX): Sees Bitcoin closing the year just above $100,000, based on a Fibonacci extension analysis.

• Ben Simpson (Collective Shift): Also expects Bitcoin to reach the $100,000 mark, buoyed by the Trump election, easing interest rates, and robust ETF trading volumes.

These forecasts highlight a strong consensus that Bitcoin will remain in the high range, with some expecting prices to approach or exceed the six-figure milestone by the end of the year.

Read more: Bitcoin Price Prediction 2024-25: Plan B Forecasts BTC at $1 Million by 2025

The recent surge past $90,000 has reaffirmed Bitcoin’s position as a resilient, highly sought-after asset. With strong support from institutional investors, robust spot buying, and favorable economic conditions, Bitcoin appears poised to continue its upward trajectory.

The $100,000 mark has become a psychological target for both investors and analysts. While some experts predict caution due to potential corrections, the overwhelming sentiment remains bullish. With the December options expiry acting as a potential catalyst, Bitcoin’s journey toward six figures is likely to capture the world’s attention. As 2024 draws to a close, the question remains: will Bitcoin’s momentum carry it to new all-time highs? The answer may soon be clear.

Read more: BTC ETF Sees Net Inflow of $61.3 million, $DOGE Sees 140% Surge with 75,000 New Dogecoin Wallets, BlackRock Expands Tokenized BUIDL Fund: Nov 14