As a seasoned researcher with over two decades of experience in financial markets, I must say that the current crypto market dynamics are reminiscent of the dot-com bubble of the late 90s. The parallels are striking: an asset class experiencing exponential growth, fueled by retail and institutional FOMO (Fear Of Missing Out), and a seemingly unstoppable march towards new all-time highs.
Bitcoin‘s price soared over 10% in the last 24 hours, reaching a new record high of approximately $89,864 earlier today. This surge pushed the total crypto market cap up by 7.9%, settling around $3.15 trillion on November 12. Meanwhile, the broader altcoin market, spearheaded by Dogecoin, saw notable gains in the past 24 hours.
Concerns about another crypto market crash similar to those seen in the second and third quarters have noticeably decreased. Furthermore, over the last few days, the Bitcoin price has persistently closed above its previous major resistance of approximately $73,000, and is now in a phase where new highs are being explored.
For the first time since April, the Fear & Greed Indexes for both Bitcoin and Ethereum have spiked above 80%, suggesting an extreme level of market greed. This surge follows a period of increased cryptocurrency volatility, leading to over $1.2 billion being wiped out from the leveraged market in just two days, with Bitcoin and Ether accounting for most of this loss.
Crypto Market Reacts to Institutional FOMO
Previously reported by Coinspeaker, the positive trend in cryptocurrencies has been fueled significantly by the backing of pro-cryptocurrency candidates, particularly Donald Trump. Notably, Trump has selected Scott Bessent, a wealthy, pro-crypto hedge fund investor, for the role of Treasury Secretary.
As a result, institutional investors have increasingly entered the cryptocurrency investment arena, with the U.S. crypto spot ETF taking the lead. Recent market figures indicate that providers of U.S. spot Bitcoin ETFs, notably BlackRock’s IBIT, have seen approximately $7.7 billion in cash inflows over the past six weeks.
Notably, no Bitcoin ETFs have seen a net outflow of funds recently, even with an increase in their daily trading activity. In contrast, as money shifts from Gold and Silver ETFs into the cryptocurrency market, Ethereum has particularly prospered in recent times.
Based on recently gathered market figures, the entities responsible for U.S. spot Ether ETF saw a substantial net deposit of approximately $295 million on Monday. As a result, they now manage a combined assets under management (AUM) of around $9.7 billion.
On Monday evening, MicroStrategy Incorporated (traded as MSTR on NASDAQ) confirmed they had completed the acquisition of 27,200 Bitcoins, valued at more than $2 billion.
Consequently, MicroStrategy now owns approximately 279,420 Bitcoins, boasting an estimated profit of more than $10 billion that has yet to be realized.
Over the course of their initial term, newly appointed US legislators aim to enact the Bitcoin Bill within the first 100 days, thereby allowing the government to acquire approximately 1 million Bitcoins over the next five years. The decision by the U.S. to adopt Bitcoin could significantly impact other nations, as they may follow suit in an attempt to mitigate their ongoing debt crises using a similar strategy.
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2024-11-12 11:49