The total crypto market cap has gained over $200 billion in the past few days, led by the recent Bitcoin (BTC) price spike above $67k. Bitcoin and Ethereum prices have surged over 10 percent in the past seven days to trade at about $67.3k and $2,618 respectively.
As a result, the meme coin space, led by Dogecoin (DOGE), has been heating up in the recent past, signaling the emergence of more speculative traders. Furthermore, more than 95 percent of Bitcoin addresses are now in profit, indicating bullish sentiment.
Factors Contributing to the Crypto Pump
Rising Open Interest (OI)
Following the notable decline in fear of further crypto capitulation in the near term, the emergence of FOMO trades has become prevalent in the crypto space. Furthermore, Bitcoin’s fear and greed index has spiked to 73 percent today, signaling traders’ greed.
Meanwhile, market data provided by CoinGlass shows that the Open Interest in Bitcoin has rallied to an all-time high of about $40 billion.
The notable spike in Bitcoin’s OI should be a signal of impending volatility in the crypto space ahead.
High Demand from Whale Investors
According to on-chain data analysis provided by CryptoQuant, new Bitcoin whale investors now hold around 1.97 million coins, a spike of over 800 percent year-to-date. A similar narrative has been observed by Santiment, which noted that whale transactions spiked to their highest level in over 10 weeks, with 11,697 transfers involving at least $100K recorded on Tuesday.
Consequently, the supply of Bitcoin on centralized exchanges has gradually dropped to a five-year low.
Notably, the US-based spot Bitcoin ETFs have purchased coins worth over $1.5 billion in the past four days. Led by BlackRock’s IBIT, the US spot Bitcoin ETFs registered a net cash inflow of around $458 million on Wednesday.
October Bullish Sentiment
From historical data, Bitcoin price has performed well in the fourth quarter. Coupled with the upcoming 2024 US elections and the expected Fed rate cuts amid a shifting global economic outlook, the crypto market will likely continue in bullish sentiment.
The crypto market will likely follow gold and major stock indexes in a bullish outlook in the coming months.
