Bitcoin Price Surge Driven by Spot Market Demand

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CRYPTOCURRENCY News

BITCOIN,CRYPTOCURRENCY,SPOT MARKET

Bitcoin's recent price surge is attributed to growing spot market demand, according to CryptoQuant analysts. This trend suggests a shift away from speculative trading in the Futures market towards long-term investment in the spot market.

BTC has declined by 2.46% over the past 24 hours. Despite this dip, the market continues to experience higher demand, especially in the spot market. This surge in spot market demand is evident through the decline in fund flow ratio. Notably, users are withdrawing funds from exchanges and holding them in private wallets. This is a bullish signal showing reduced exchange activity, which correlates with long-term market confidence. Additionally, Bitcoin’s stock-to-flow ratio has spiked to 46.

5k after declining to 37k. A surge in SFR suggests a spike in BTC scarcity. CryptoQuant analysts have cited growing spot market demand as the major factor pushing BTC’s prices up. They posited that Bitcoin’s bull cycle is either driven by the Futures market or the spot market. As such, the 2023 bull run was driven by the Futures market followed by a spike in spot market activity, thus driving prices up.However, the spot and Futures market saw a prolonged decline from March 2024 to September. In October 2024, Bitcoin saw a rise in trading volumes for both markets, which has since driven prices up to new ATH. While Futures market demand has declined over the past month, spot market demand continues to increase. This surge in spot market demand suggests that speculative excess in the Futures market is cooling, while buying pressure in the spot market is gaining momentum. Therefore, Futures markets will continue to experience a cycle of liquidations and overheating, thus resulting in BTC’s price growth. As such, this price movement will encourage further capital inflows into the spot market

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