Bitcoin faces ‘upside catalysts’ in the next few months

The rally in bitcoin has legs, analysts tell Blockworks

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Zhane Luk/Shutterstock modified by Blockworks

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Bitcoin briefly topped $35,000 on Monday night, hitting a high not seen in over a year.

The listing of BlackRock’s iShares Bitcoin Trust on the DTCC website fueled the rally, following last week’s false tweet suggesting the company had received the US Securities and Exchange Commission’s approval.

As of Tuesday morning, however, the BlackRock DTCC listing no longer appeared on the website, a fact that did not seem to surprise Bloomberg analysts Eric Balchunas and James Seyffart.

Balchunas said he’s “not totally shocked” by the listing being removed

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“My guess is they were told to or want to wait until they are days, not weeks or months away. As I said [yesterday] it was surprising to see it on there.”

Following the news, bitcoin (BTC) fell slightly before regaining and holding around $33,000 at the time of publication. 

GSR’s senior strategist Brian Rudick told Blockworks that “the latest bitcoin rally is in hopes for a US spot bitcoin ETF approval [that] will likely have legs into the actual approval and is absolutely a long-term positive for crypto.”

Read more: Is bitcoin’s ETF-fueled rally to $35K premature? Well, maybe

Bitcoin is the “benefactor of yield fears within crypto, and it seems to be at the helm of industry momentum,” eToro US investment analyst Callie Cox said.

“I’d expect to see Bitcoin and Ethereum pull ahead of other protocols as crypto-centric investors look for places to hide.”

However, as Ledn’s chief investment officer John Glover noted, the rising price of bitcoin tends to filter money into other cryptocurrencies. 

Read more: CME says Q3 open interest for bitcoin, ether derivatives hit all time highs

“This means there is a very real possibility that the launch of one or more spot ETFs could lead to the next major bull run in the entire cryptocurrency ecosystem,” he said.

Galaxy’s head of firmwide research, Alex Thorn, also sees “upside catalysts” in the next few months. 

“The general bitcoin uptrend has significant retail involvement, with on-exchange volumes surging in anticipation of forthcoming ETF approvals. Today, bitcoin continues to show strength trading in the $34k range. The gamma squeezes no doubt caused some pain to options market makers, and some of the dynamics are still at play in the options markets, though with some of the covering that occurred, the risk of explosive upside in the near term is somewhat reduced.”

Dealers, Gray noted, still face “significant upside risk” with a “continued drop of ETF-related headlines over the next couple months.”


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