Bitcoin prices have started to climb again this week, breaking past the significant resistance of $97,000, hitting their highest point since February.
As of Saturday’s report, Bitcoin (BTC) was trading around $96,500, marking a 30% increase from its low in April. Here, we’ll explore three main reasons why it might reach new all-time highs this year.
Declining Bitcoin Supply on Exchanges
One significant factor is the decreasing Bitcoin supply on exchanges, which has fallen to 1.42 million—its lowest level in more than six years. Specifically, this is the least amount since November 2018, when supplies peaked at 3.21 million.
Data also indicates that the non-exchange Bitcoin supply has increased to 18.43 million, suggesting that investors are choosing not to sell their coins. This could create supply pressure as demand rises.
Many major Bitcoin holders, like Michael Saylor, who owns over 2% of the total supply, are not selling anytime soon. Companies such as Coinbase, Tesla, Galaxy Digital, and Block also show no signs of liquidating their holdings.
High Demand from Retail and Institutions
Another crucial reason for rising Bitcoin prices is the ongoing high demand from both retail and institutional investors.
For instance, Bitcoin ETF inflows have remained stable without any leaks for four months now, according to data from Sosovalue, since their launch last January.
These funds have collectively amassed over $40 billion in assets. BlackRock’s IBIT holds $6 billion, while Fidelity’s FBTC and ARK Invest’s ARKB contain $20 billion and $19 billion, respectively.
The surge in ETF inflows signals strong institutional interest in the U.S., and there are hints that other countries are also looking to diversify away from the U.S. dollar.
These dynamics in supply and demand clarify why analysts are optimistic about Bitcoin. Some predict it could soar to $200,000, while Ark Invest has set its sights on $2.4 million by 2030.
Moreover, as trade tensions diminish, demand for Bitcoin is expected to rise further.
Technical Analysis of Bitcoin Prices
Finally, Bitcoin’s technical indicators show promise for long-term growth. Since August 5th, the price has been trending above a significant trendline.
It has successfully crossed crucial resistance levels around $88,690, which marks the neckline of a double bottom pattern. Additionally, it has surpassed the 50-day and 100-day exponential moving averages.
These signs suggest increasing momentum, with potential to exceed $100,000 before reaching its all-time high.
