- A CoinShares advisor believed that the current bull rally could push Bitcoin towards its ATH.
- Pent-up demand for ETFs could contribute to more price increases.
Bulls just had a field day Bitcoin (BTC) recorded a high of $64,000 on February 28. On BloombergTVMeltem Demirors, Chief Strategy Officer of CoinShares, described the bullish rally as:
“The most hated rally because we weren’t ready for it.”
The rally started in November 2023 and defied the expectations of a to sell following the launch of a highly anticipated Bitcoin Exchange Traded Fund (ETF).
Demirors attributed the price increase to the significant demand created by the ETF, which absorbs 10,000 BTC per day, compared to the daily mining rate of just 900 coins.
She predicted that the next major target would be the all-time high (ATH) of $69,000, showing optimism about Bitcoin’s continued growth through 2024.
The ETF market offers untapped potential
The introduction of Bitcoin ETFs has opened up new avenues for investors, with Demirors seeing over $20 billion inflows into these ETFs in the past two months alone.
Despite some outflows on the Grayscale side, net inflows were a whopping $10 billion at the time of writing.
Bitcoin ETFs’ daily trading volume has also reached new highs, with a record of around $2.5 billion traded in a single day, putting it on par with some of the largest US stocks.
However, the director pointed out that many platforms have not yet offered these ETFs, leading to a significant campaign on crypto X (formerly Twitter).
The smaller average trade size observed indicated that a significant segment of potential investors had yet to enter the market. This demand could be unleashed once accessibility improves.
Bitcoin’s volatility is no longer a problem
Historically, Bitcoin’s volatility has been a point of contention for potential investors.
However, Demirors argued that this is becoming less of a concern compared to other asset classes, which have also experienced greater volatility.
“And at the end of the day, the allocations we’re talking about aren’t that big. Investors can allocate a few percentage points of their portfolio to Bitcoin even if there is some volatility, just given the dynamics between supply and demand. Does that feel like a crazy idea?”
This shift, along with the continued rise of higher highs and lows over the past decade, signals a maturing market for Bitcoin.
What’s the next big thing in crypto?
Demirors emphasized that the anticipation surrounding the Ethereum ETF, due in May, has created a wave of enthusiasm in the economy. Ethereum (ETH). She suggested this is the next big thing in institutional allocation.
Apart from that, she emphasized:
“I’m very excited about what’s happening in the Solana ecosystem. I love my dogs, my frogs and my memes.”
The executive noted that meme coins often indicate widespread retail involvement once they surge, marking an important phase of market participation that has not yet been fully realized.