Matrixport Market Observation: BTC Returns to $100,000, Market Bullish Sentiment Clearly Evident

Last week, the BTC price steadily rose, closing positively for 7 consecutive days, returning to $100,000. Since BTC hit a low of $91,530.45 on December 30, the price rebounded, increasing for 7 days. As of January 6, BTC reached a high of $102,724.38, with a maximum weekly increase of 11.35%. Currently, the real-time price of BTC is $101,812.95. The price trend of ETH is similar to that of BTC, increasing for 7 days and climbing to $3,744.83 on January 6, with a maximum weekly increase of 13%. The current price of ETH is $3,683.14 (the above data is sourced from Binance spot, January 7, 12:16).

This week, selling pressure has diminished, and market liquidity has recovered. The strong rebound of BTC has driven other popular coins like ETH and SOL to rise, enhancing bullish sentiment in the market. However, market trader Crypto Scient believes that $100,000 remains a key turning point for BTC. Unless BTC converts $99,000 into a long-term support level, the price may retest the $90,000-88,000 area.

Market Analysis

As of January 6, 2025, the total market capitalization of cryptocurrencies worldwide reached $3.65 trillion, an increase of 6.7% from last week's $3.42 trillion. Among them, the U.S. spot BTC ETF performed remarkably, with the total on-chain holdings surpassing 1.129 million BTC, accounting for 5.70% of the total BTC supply, valued at approximately $106.8 billion. This week, the net inflow of funds into the U.S. spot BTC ETF reached $240 million, with a historical cumulative net inflow of $38.9 billion, further solidifying its position as an important funding entry point for the market.

Bullish sentiment in the BTC options market is high, with traders betting on a price breakthrough of $120,000

Data from Deribit on January 6 shows a significant increase in options activity with strike prices of $110,000 and $120,000, reflecting strong expectations from traders for further price increases. As of now, the open interest for call options with a strike price of $120,000 has reached $1.52 billion, making it the most popular contract type on the Deribit platform. With Trump's inauguration approaching, the BTC market is exhibiting new optimism, particularly in the performance of the options market.

Meanwhile, the put/call ratio for all expiration dates has dropped to 0.24. This low ratio indicates that the trading volume of call options far exceeds that of put options, highlighting market confidence in the upward movement of BTC prices. Additionally, the price pullback at the end of December caused BTC to briefly touch $91,000, but it has quickly rebounded to $101,000, further solidifying the market's optimistic expectations for an upward trend.

With Trump's impending inauguration, the market is paying attention to potential policy benefits, and the activity level in the BTC options market may become a leading indicator for future price movements.

Miner selling pressure and exchange inflows both decline, tightening supply supports BTC's mid-term bullish outlook

On January 6, Bitfinex reported that the liquidity inventory ratio of BTC has significantly decreased from 41 months in October 2024 to 6.6 months, with continuous outflows from exchanges. This week, only 200,000 BTC flowed into exchanges, and the unrealized profit rate for short-term holders has dropped to 12%. The increase in stablecoin supply also indicates that market capital reserves are ample, with a strong wait-and-see sentiment. During the same period, BTC exchange inflows and miner outflows continued to decline, further alleviating market selling pressure and reinforcing the mid-term bullish outlook for BTC.

At the same time, the outflow of BTC from miners to exchanges has also significantly decreased, indicating a slowdown in miner selling pressure. Data from CryptoQuant shows that on November 11, 2024, miners sent 25,367 BTC to exchanges, reaching a peak, while by early January 2025, this number had dropped to between 2,000 and 5,000 per day. The change in miner behavior reflects their preference to hold positions in anticipation of price increases.

The dual effects of reduced supply and decreased selling pressure lay a solid foundation for BTC's mid-term rise. As the market's chip structure stabilizes, BTC's upward trend is expected to continue.

Institutional and corporate accumulation accelerates, BTC is expected to break $200,000 in 2025

On December 31, Standard Chartered's head of digital asset research, Geoffrey Kendrick, predicted that the price of BTC would reach $200,000 by the end of 2025, with continued accumulation by institutions and corporations being the core driving force. Since the beginning of 2024, institutions have purchased 683,000 BTC through channels such as spot BTC ETFs and MicroStrategy.

On the corporate side, the "BTC accumulation plan" has become a trend. According to Bitwise CEO Hunter Horsley, "Since last Monday, 11 publicly traded companies have purchased more BTC. 2025 may be an important milestone for more companies to adopt the BTC standard." Japanese listed company Metaplanet plans to increase its BTC holdings to 10,000 by 2025 to promote global adoption.

The dual effects of accelerated institutional buying and alleviated supply conditions provide a solid foundation for BTC's mid to long-term rise in 2025.

Trump-themed Memecoins lead the charge, altcoin sector sentiment warms up

On January 7, the U.S. Congress officially confirmed Trump's election as president, and his crypto-friendly policy expectations have driven related tokens to rise. The Trump-themed Memecoin TRUMP has risen for 3 consecutive days since January 4, with a cumulative increase of over 80%; MAGA, TRUMPCOIN, and others have seen increases close to 100%, but have since pulled back. Meanwhile, family project World Liberty Financial's holdings of LINK, AAVE, and other tokens have not shown significant upward momentum.

Market sentiment has turned optimistic, with the cryptocurrency fear and greed index rising to 78, entering the "extreme greed" zone. BTC's return above $100,000 has driven a general bullish sentiment in the market, but the altcoin sector has seen mixed performance. SOL has once again broken through 220 USDT, AVAX has risen by 6%, while SUI has pulled back to 5 USDT after reaching a new high.

The ETH ecosystem sector has experienced a brief pullback, with LDO down about 3% and ENA down nearly 10%. Despite positive market expectations, volatility remains a core focus in the near term, and investors should be wary of short-term pullback risks.

Market Highlights

Federal Reserve reserves fall below $3 trillion, hitting the lowest level since 2020

On January 3, according to Federal Reserve data, U.S. bank system reserves fell to approximately $2.89 trillion for the week ending January 1, dropping below the $3 trillion mark, the lowest level since October 2020, and recording the largest single-week decline in two and a half years, decreasing by about $326 billion.

Year-end regulatory requirements have prompted banks to reduce balance sheet activities, with funds flowing from banks to the Federal Reserve's overnight reverse repurchase (RRP) tool. At the same time, the Federal Reserve continues to remove excess cash from the financial system through its quantitative tightening (QT) program, further tightening liquidity. Investors are advised to closely monitor changes in Federal Reserve policy and their potential impact on the banking system.

BTC mining difficulty hits a new high, miner revenue reaches $1.44 billion

BTC network mining difficulty and hash rate continue to rise. On December 30, 2024, BTC mining difficulty was adjusted up by 1.16% to 109.78 T, setting a new historical high, with the average network hash rate reaching 804.04 EH/s. The next difficulty adjustment is expected to increase to 111.20 T. Despite improvements in mining machine efficiency, the rapid growth of global hash rate and rising energy costs pose pressure on mining profitability.

In this high-difficulty environment, miner revenue remains strong, with cumulative revenue reaching $1.44 billion in 2024. Large mining company MARA reported that it achieved $8.7 million in interest income in the first three quarters by optimizing resource utilization and lending strategies, while its powered hash rate reached 53 EH/s. As competition intensifies, miners need to continuously optimize strategies to maintain profitability in a fierce market.

Disclaimer: The above content does not constitute investment advice, sales offers, or purchase offers to residents of the Hong Kong Special Administrative Region, the United States, Singapore, or other countries or regions where such offers or invitations may be prohibited by law. Trading in digital assets may involve significant risks and volatility. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions made based on the information provided herein.