Market commentary
The time has finally come. The price of bitcoin has broken through the psychological barrier of $100,000. This extends the meteoric rise of the first and largest cryptocurrency since the beginning of the year to +143%. After a six-month consolidation phase over the summer, Trump's election victory was the decisive spark to launch Bitcoin's expansion to new all-time highs. For the first time, bitcoin is now trading above $100,000.
ETF Investors Buy Relentlessly
On January 11, 2024, nearly a dozen fund providers received approval to launch the first spot-based bitcoin ETFs in the United States. The issuers include financial giants such as BlackRock, Fidelity and many others. Since their launch, hundreds of millions of dollars have flowed into these products on a weekly basis. Contrary to the expectations of many, the inflows did not slow down after the record-breaking start. Instead, ETF investors have accelerated their bitcoin investments in recent weeks.
To date, net inflows have reached $31.7 billion since the products were approved. No asset class has ever had such a strong start in the history of ETFs. Combined with the significant price gains over the past year, bitcoin ETFs now manage over $111 billion in assets. By comparison, U.S. gold ETFs have approximately $130 billion in assets under management (AuM). The virtual version of the precious metal is catching up in record time.
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The early stages of "Altcoin Season"
As is typical in the early stages of a crypto rally, bitcoin has taken the lead so far. Alternative cryptocurrencies ("altcoins") have largely lagged behind. However, the tide is turning. Over the past month, several altcoins have rallied more than 100%. Bitcoin's dominance in total market capitalization is diminishing. Some investors are already talking about an "altcoin season" - a period of significant gains in alternative digital assets.
This week's winners were Tron (+66.02%), XRP (+61.82%) and Chainlink (+33.32%). Over the past 30 days, Stellar is up +435.61%, XRP is up +366.29% and Cardano is up +265.24%. The "dinosaurs" are awakening from their slumber. Thanks to the strong performance of altcoins, the total crypto market capitalization has surpassed the all-time high of $3 trillion set in 2021, initiating a parabolic price discovery. Bitcoin still accounts for 56% of the total market cap.
Disclaimer
All information in this publication is provided for general information purposes only. The information provided in this publication does not constitute investment advice and is not intended as such. This publication does not constitute and is not intended as an offer, recommendation or solicitation to invest in any financial instrument, including cryptocurrencies and the like. The contents contained in the publication represent the personal opinions of the respective authors and are not suitable or intended as a basis for decision-making.
Risk notice
Investing in cryptocurrencies, is fundamentally associated with risk. The total loss of the invested capital cannot be excluded. Cryptocurrencies are very volatile and can therefore be exposed to extreme price fluctuations in a short period of time.
