Bitcoin surpassed $71,000 in Asian trading hours, with a 5% increase over 24 hours, leading to significant trading volume and the liquidation of over $143 million in short positions.
The rally was partly driven by whale activity on Binance and substantial inflows into Bitcoin ETFs, which saw a net increase of 47,000 BTC in the last two weeks.
The surge is influenced by the upcoming U.S. elections, with traders betting on bullish market conditions regardless of the outcome.
Bitcoin jumped above $71,000 in Asian morning hours Tuesday to lead a wider market move ahead, nearly a week ahead of the U.S. elections that traders largely consider a bullish catalyst for the market regardless of who wins.
BTC added 5% in the past 24 hours, CoinGecko data shows, breaking out of a key $70,000 resistance with $48 billion in trading volumes, or nearly double the volumes from Monday.
The move led to over $143 million in shorts, or bets against higher prices, to be liquidated in the past 12 hours, which may have contributed to a price spike higher as traders closed losing bets. BTC shorts lost $73 million, followed by $39 million on ETH shorts, data from CoinGlass shows.
“We see some shorts against the 70k getting liquidated as the market seems to be pricing in increasing certainty of a trump victory,” QCP Capital co-founder Darius Sit told CoinDesk in a Telegram message.
CryptoQuant community analyst Mignolet attributed part of the buying demand to whales — a colloquial term for influential traders — on crypto exchange Binance, who are appearing to be net buyers of the asset largely in Asian hours.
Bitcoin exchange-traded funds (ETFs) have further contributed to demand with a net inflow of 47,000 BTC over the past two weeks.
Majors led by dogecoin (DOGE) surged higher. DOGE jumped 15% on continued Trump popularity, led by shiba inu (SHIB) at 8%. Ether (ETH) rose by 4.9%, while Cardano’s ADA, Solana’s SOL, and BNB Chain’s BNB jumped by more than 3%.
The broad-based CoinDesk 20 (CD20), a liquid index tracking the largest tokens by market capitalization, rose 3.3%.
Tuesday’s move higher comes amid a shift of tone ahead of the November elections, with traders expecting BTC to set fresh highs regardless of a Republican or Democrat presidential victory in the U.S.
Traders have long perceived Republican Donald Trump’s victory as a bullish catalyst for the industry for his pro-crypto stance and promises to make the U.S. a bitcoin powerhouse.
Democrat Kamala Harris, on the other hand, has not made similar promises but said he would introduce regulations to protect certain groups. However, some say the asset is poised to go higher either way as several macroeconomic factors weigh in.
Crypto options traders are increasing their bets that bitcoin will touch fresh highs by the end of November. Options due to expire on November 8 have their highest open interest at the $75,000 strike price, indicating a key market focus area for that period, as previously reported.