Bitcoin is surging to new heights, hitting an all-time high near $81,000, and investors are betting big on even more gains. With the latest rally, open interest in Bitcoin futures on the Deribit exchange—where investors can bet on future Bitcoin prices—has skyrocketed to over $2.8 billion, particularly on contracts predicting Bitcoin will exceed $90,000. Here’s why all eyes are on Bitcoin and the growing optimism surrounding its future.
Bitcoin Hits Record High: Why Investors Are Betting on $90,000
Bitcoin has been on a historic run, recently hitting a new all-time high near $81,000. But this isn’t the peak, according to many investors. Futures contracts—where investors predict Bitcoin’s price—are showing significant premiums, indicating strong belief that Bitcoin is just getting started. Open interest in futures betting on Bitcoin exceeding $90,000 has now surpassed $2.8 billion on Deribit, one of the leading platforms for crypto derivatives.
The Power of Pro-Crypto Election Results
So why this sudden surge? A key factor is the outcome of recent U.S. elections, which saw a surge in pro-crypto candidates winning office. With political support shifting in favor of cryptocurrency, many investors are now more optimistic about the future of digital assets. Pro-crypto policies, such as the potential launch of a U.S. crypto stockpile and ongoing support for the market, have given a major boost to investor confidence.
According to Vetle Lunde, Head of Research at K33 Research, “The options market’s bias is heavily toward continued momentum.” This is seen in the increasing volume of call options—bets that Bitcoin will rise—trading at a premium compared to put options, which bet on a fall in price.
Bitcoin’s Surge Reflects Growing Institutional Interest
The institutional side of Bitcoin trading is also seeing significant activity. The CME, a major derivatives exchange, recently reported that Bitcoin futures premiums have spiked to 14%—a jump from the typical 7% to 10% range. This surge is a clear indication of growing institutional interest and optimism surrounding Bitcoin’s price trajectory.
As for the futures market, these contracts are allowing traders to bet on where Bitcoin’s price will go without an expiration date. This flexibility has led to an explosion in trading volume and open interest, especially as investors use leverage to maximize potential returns from the ongoing rally.
The Role of the Federal Reserve and Interest Rates
Another factor fueling Bitcoin’s rise is the Federal Reserve’s decision to cut interest rates, a move that often drives investors toward riskier assets like Bitcoin. Lower interest rates make borrowing cheaper, and this typically increases investment in assets like cryptocurrencies. Combined with political support for crypto and growing institutional involvement, Bitcoin’s surge has gained significant momentum.
In fact, after the election results and the Fed’s second consecutive interest rate cut, the entire crypto market experienced a surge. Notably, Ethereum (ETH) outpaced Bitcoin with a 30% increase over the past week, and Solana’s market cap topped $100 billion on Sunday.
Bitcoin ETFs and Corporate Gains
Bitcoin-related stocks are also riding high on the crypto wave. Coinbase, one of the biggest crypto exchanges in the U.S., saw its stock jump 48% in one week, marking its strongest performance since January 2023. Coinbase, a major player in the crypto industry, was a big donor to pro-crypto campaigns during the election cycle.
Coinbase’s legal chief, Paul Grewal, stated, “We’re going to have the most pro-crypto Congress ever, and Coinbase has played some part in all of that.” This growing political support for cryptocurrency is not only helping boost the price of Bitcoin but also pushing up the market cap of Bitcoin ETFs (exchange-traded funds), which now total over $80 billion. In just the past three trading days, spot Bitcoin ETFs added $2.3 billion in new funds.
The Crypto Race: What’s Next for Bitcoin?
As Bitcoin continues its impressive rise, the question remains: what’s next for the world’s largest cryptocurrency? With more pro-crypto policies on the horizon and a growing interest from both retail and institutional investors, Bitcoin’s price could continue to soar. The recent surge in futures premiums, along with the growing open interest in contracts predicting Bitcoin will top $90,000, signals that many expect Bitcoin’s bull run to persist for the foreseeable future.
As crypto-related stocks continue to perform well and major players like Coinbase and Robinhood experience sharp gains, it’s clear that the crypto industry is only gaining momentum. This could be just the beginning of a new era for Bitcoin and digital assets as a whole.
Conclusion: Bitcoin’s Bull Run Could Be Far from Over
Bitcoin’s price surge has caught the attention of investors, with more than $2.8 billion riding on Bitcoin crossing the $90,000 threshold. A mix of pro-crypto political movements, institutional interest, and favorable market conditions have combined to fuel a historic rally in Bitcoin’s price.
As more investors, both retail and institutional, pour money into Bitcoin, the cryptocurrency’s price could keep climbing higher, with some predicting that it could exceed $100,000 in the near future. While there may be some market volatility, the overall outlook for Bitcoin remains overwhelmingly bullish as we approach a new chapter in the crypto revolution.
I am Aparna Sahu
Investment Specialist and Financial Writer
With 2 years of experience in the financial sector, Aparna brings a wealth of knowledge and insight to Investor Welcome. As an accomplished author and investment specialist, Aparna has a passion for demystifying complex financial concepts and empowering investors with actionable strategies. She has been featured in relevant publications, if any, and is dedicated to providing clear, evidence-based analysis that helps clients make informed investment decisions. Aparna holds a relevant degree or certification and is committed to staying ahead of market trends to deliver the most up-to-date advice.