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Bitcoin Price’s Potential Surge to $112K Fueled by ETF Inflows: CryptoQuant

The price of Bitcoin might surge to a record-breaking $112,000, driven by substantial investments pouring into spot Bitcoin exchange-traded funds (ETFs). A recent study by CryptoQuant suggests that this projected peak relies heavily on sustained buying activity stemming from the increased influx of funds into these ETFs. Even in a “worst-case” scenario, the analysis indicates that Bitcoin could still experience a significant uptick, potentially reaching at least $55,000.

Bitcoin Price to Possibly Peak at $112,000

“Per month, the Bitcoin market has witnessed an influx of $9.5 billion in spot ETF investments, potentially enhancing the yearly realized cap by $114 billion,” stated Ki Young Ju, the founder and CEO of CryptoQuant.

“Even amidst outflows from GBTC, a rise of $76 billion could potentially elevate the realized cap from $451 billion to a range between $527 billion and $565 billion,” Ju continued.

Furthermore, Ju explained that historically, the Bitcoin market has exhibited a trend where its lowest points, or market bottoms, align with a Market Value to Realized Value (MVRV) ratio of 0.75, while market peaks coincide with an MVRV ratio of 3.9.

The MVRV ratio, which contrasts market capitalization (representing the current value of all mined Bitcoins) with realized capitalization (the value of all Bitcoins at their acquisition price), serves as a vital gauge for evaluating Bitcoin’s valuation extremes.

As per the report, if the ongoing trends in Bitcoin ETF inflows persist, the MVRV ratio could escalate to levels typically associated with market peaks, potentially propelling Bitcoin’s price to a range between $104,000 and $112,000.

Conversely, in the absence of heightened market fervor and with the MVRV ratio resting at 2.07, Bitcoin’s price was anticipated to maintain within the range of $55,000 to $59,000.

Recent ETF Inflows and their Impact

Recent market activity serves as a concrete illustration of how ETF inflows can impact the price of Bitcoin. As of the time of writing, Bitcoin is presently trading at $48,129, marking a 12.57% increase compared to its value a week ago, as reported by CoinMarketCap.

The influx of funds into new spot Bitcoin ETFs has notably influenced the Bitcoin market, with a total of $8 billion in net gains recorded over the span of 10 days. Leading this surge are ETFs from BlackRock and Fidelity, specifically the iShares Bitcoin Trust (IBIT) and Wise Origin Bitcoin ETF (FBTC), which respectively accumulated $2.6 billion and $2.2 billion.

Furthermore, the market is closely monitoring the anticipated Bitcoin halving event scheduled for April, which is expected to further bolster Bitcoin’s price due to the diminished mining reward and subsequent increase in scarcity.

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