Bitcoin, Ethereum, and Altcoins See Rebound Amid ETF Struggles: A Look at the Market's Year-End Moves

December 26, 2024 BACK TO NEWS

Bitcoin rallies, but ETFs face outflows while Ethereum sees growing interest. What's next for Bitcoin? - IcoHolder.

Despite a generally sluggish market last week, cryptocurrencies have experienced a surge in the past 24 hours. Bitcoin, Ethereum, and altcoins have shown signs of life, with Bitcoin rallying from $94K to $99K, a movement some are calling a "Santa Claus rally." However, this rebound could also signal a shift in profit-taking as the year-end expiry approaches. Currently, Bitcoin is holding above $98K, but with caution in the air, traders are eyeing upcoming expiry dates for clues about the market's next move.

Bitcoin ETFs Face Major Outflows

While the broader market saw some green, Bitcoin ETFs have not fared well. BlackRock’s Bitcoin ETF, the iShares Bitcoin Trust (IBIT), experienced a massive outflow of $188.7 million on Christmas Eve, its largest single-day loss to date. This marked part of a worrying trend, as Bitcoin-related funds saw a combined outflow of $1.5 billion between December 19 and 24. Other Bitcoin ETFs, including those from Fidelity and ARK 21Shares, also saw significant outflows, signaling waning investor interest in the traditional Bitcoin ETF products. Interestingly, Bitwise Bitcoin ETFs were the only ones to record an inflow during this period.

Ethereum ETFs and Altcoins Stir Interest

While Bitcoin ETFs are struggling, Ethereum (ETH) has captured growing attention. ETH ETFs are experiencing steady inflows, signaling a potential shift in investor sentiment. Ether funds saw $53.6 million in inflows in recent days, following a significant $130.8 million boost just the day before. This increase in interest in Ethereum, particularly with the ETH/BTC ratio showing strength, suggests that Ether could outperform Bitcoin in the early part of 2025. Traders and analysts are beginning to speculate that Ethereum’s role in the market may be growing, with altcoins following suit as Bitcoin's dominance shows signs of weakening.

What’s Next for Bitcoin?

As Bitcoin's price recently jumped 4% to $98,014, the question remains: what’s next for the king of crypto? BlackRock’s Bitcoin ETF outflows and a general trend of withdrawals have left investors questioning the next move. Crypto analyst Skew noted that passive ask liquidity for Bitcoin is hovering around $100K, with key resistance at $105K. It’s possible that large market players are positioning themselves for higher prices as the new year approaches, though the market remains unpredictable.

Despite the recent price jump, trading volume for Bitcoin has decreased by 24%, which may signal reduced investor interest. With significant BTC options set to expire this Friday, traders are urged to monitor market volume and sentiment closely, as these factors could signal a shift in direction for Bitcoin’s price and market dominance.

The Road Ahead: A Market in Flux

The current movements in the cryptocurrency market suggest a potential shift in investor focus, as Bitcoin’s dominance faces increasing challenges from altcoins like Ethereum. While Bitcoin remains a key player, the influx of interest in Ethereum and altcoins, combined with the ongoing struggles of Bitcoin ETFs, could mean the start of a broader market transition. As we head into the final days of the year, all eyes will be on the upcoming expiration of Bitcoin options and whether this will trigger further volatility or stabilize the market.

Ultimately, the next few weeks will be crucial in determining whether Bitcoin can maintain its leadership position, or if Ethereum and other altcoins will take the lead as we enter the new year.