Bitcoin’s recent rally has seen the cryptocurrency reclaim the $78,000 mark, driven primarily by institutional accumulation and robust inflows into spot Bitcoin ETFs. However, the options market reflects skepticism regarding further gains, pricing in only a 25% chance of BTC reaching $84,000 by the end of May. This cautious outlook is underscored by a weakening monthly futures basis rate and a persistent demand for downside protection, as indicated by the elevated premiums on put options.
Despite the lack of bullish sentiment in derivatives, institutional demand remains strong, with US-listed Bitcoin ETFs accumulating $3.3 billion in net inflows over the past two months. Additionally, several companies have significantly increased their Bitcoin holdings, absorbing more than five months’ worth of future mining supply, which could mitigate potential selling pressure.
For market professionals, the key takeaway is that while the options market shows hesitance, the underlying institutional demand could sustain Bitcoin’s bullish momentum, making it essential to monitor ETF flows and corporate accumulation trends.
Source: cointelegraph.com