What exact factors have contributed to the Bitcoin price rise today? Pump factors such as record stablecoin liquidity and high whale transactions are some factors that are helping to drive the price of Bitcoin up. However, as the cryptocurrency market progresses several events point to the possibility of a broader rally for Bitcoin.
The rise of the Bitcoin price is attributed to the increased stablecoin liquidity in exchanges. Market capitalization has risen to $169B with Tether (USDT) and USD coins (USDC) dominating the market. Typically, as global Bitcoin prices have climbed, the supply of stablecoins has also been on an uptrend.
The logic behind this connection is simple: On one hand, USDT and other stablecoins can traded for Bitcoin and other digital assets. On the exchanges, stablecoin balances rise which means traders are willing to start trading bitcoins. The circulating supply of USDT on exchanges has grown by 146% since January 2023 and has equaled $22.7 billion. This stablecoin liquidity is ready to be used as ‘dry powder’ to buy Bitcoin which can further propel prices up.
Another reason that contributed to Bitcoin’s price going up is the growing number of large ‘whale’ transactions. Whales are actual people or corporate bodies that own lots of Bitcoin and their decision influences the space. Lately, the whales have again come to the forefront when it comes to Bitcoin network interaction.
The on-chain analytics firm Santiment shared that even inactive BTC transactions increased to more than $37.4 billion in on-chain transactions. In the past, Whales pumping large volumes of BTC into the market has led to hikes in the price of Bitcoin. Earlier this year, one of the whales purchased 200 BTC for $12.56 million, with total trading profits of $181 million. Such moves indicate that whales are accumulating for future profits, which also helps the price go up.
CryptoQuant data demonstrates that increases in stablecoin holdings are positively related to Bitcoin price movements. As of early 2023, while the value of Bitcoins remained almost unchanged during the first half of the year, stablecoins showed an increase of 20%. This points out that investors are willing to put more money into BTC, waiting for the right time to buy.
For the record, the statistics show that October in the Bitcoin market has always been favorable with an average rise of 22% from 2013. Thus, while Bitcoin has dropped by over 6% since the beginning of October, the price tends to increase after the middle of October based on previous years. The rise in stablecoins is expected to boost the price of Bitcoins during this period due to better liquidity.
Other figures in the economic landscape are also influencing the prices of Bitcoin's upswing as well. Following several Chinese authorities’ signals to increase debt emission, Bitcoin’s price has been boosted since investors seek additional investment instruments. Although there was no mention of an expected fiscal stimulus that could impact traditional markets, traders found their way to cryptocurrencies.
Further, fluctuating politics in the United States is felt to be affecting the costs of Bitcoin. The tech industry, including digital currencies, considered Vice President Kamala Harris’s announcement to improve AI governance as a positive signal.
However, the recent launch of a new cryptocurrency venture with the former President of the United States, Donald Trump, puts him on the side of crypto (ahead of the next U.S. voting period). These events are contributing to the formation of rules governing blockchain and its applications, including Bitcoin as an investment vehicle.
October is one of the most popular months for Bitcoin, which is associated with a bullish market. For most of these years, the crypto has registered high price appreciation during this period. In particular, historically, the yields for Bitcoin tend to be positive at the end of October, and the maximal increase in this period might be 60%. This seasonality has positioned October highly for Bitcoin investors with an average return rate of about 22%.
While Bitcoin flew into October, more analysts are sure to see a price rise at the so-called Golden Cross fueled by high stablecoin and whale activity. Established entities across the markets also seem to be gearing up for quite an extensive trend higher, something that further supports the Bitcoin short-term bullish sentiment.
Whales have shown a knack for making strategic moves in the Bitcoin market. As per the Lookonchain website, one of the prominent whales bought 6,000 BTC in August and September last year at an average of $26,429. This purchase brought the whale to spend $ 158.6 million during the dip, further emphasizing the purchasing power of a whale. In the past, the investor had purchased 2,000 bitcoins for around $88.76 million, which was as much as $44,381. This happened before the highly anticipated launching of the Bitcoin exchange-traded fund on January 10th.
However, the whale's most notable action considered the selling of around 1,500 Bitcoin. This occurred during the peak of March when the most valuable cryptocurrency reached an average price of $68,398. The whale's acute ability to take advantage of market peaks was mirrored by the enormous $102.6M received from the corresponding sale.
Such organized market manipulation and control of volumes to dictate the market trends illustrate the impact the whales make on Bitcoin’s price shift. The moves made by these investors give the public an insight into what might be expected of the prices in the future.
Taking into consideration the current market trends, it can be expected that Bitcoin will continue to increase its price over the next weeks. Higher stablecoin supply, the growing number of whale transactions, and historical appreciation are also suggesting the likelihood of an uptrend. Nonetheless, regulatory changes and any macroeconomic influences are also expected to have a significant impact on the future trends of Bitcoin investments.
Thus, investors are tracking political events, including the U.S. presidential one, and overall economic trends; therefore, Bitcoin’s price will depend on them as well. Therefore, the current situation with the stablecoin and whales’ presence demonstrates that Bitcoin is ready for a rally while maintaining the October pattern.
Hence, the current Bitcoin price rise can be explained by the stablecoin market, whale activity, and economic factors such as capital flow. Holders and investors are likely to increase their Bitcoin holdings, and this puts the leading virtual currency on an upside trajectory in the upcoming weeks. As the historical data suggests and with favorable forces behind our analyzed market, Bitcoin’s impulse could be far from over.