How Close are We To This?

As Bitcoin approaches $100,000, is this just the beginning of a larger bull run or will market volatility disrupt momentum for both Bitcoin and altcoins?

BTC broke records again

Bitcoin (BTC) has experienced a massive decline recently, leaving milestones behind as if they were minor speed bumps. As of November 21, it is trading at an eye-watering $97,000 after hitting an all-time high of $98,350, a 3% increase in just 24 hours.

BTC 6-month price chart | Source: crypto.news

This year has been a dream run for Bitcoin investors; BTC has more than doubled in value in the last two weeks alone, surging a jaw-dropping 40%, pushing its market cap to $1.93 trillion.

Much of this increase dates back to Donald Trump’s recent election victory. Investors appear optimistic about the future, as Trump has promised to make the US the “crypto capital of the planet.”

By contrast, Bitcoin-focused spot ETFs in the US have seen an influx of institutional money flowing into these funds with more than $4 billion since the election.

On November 20, US Bitcoin ETFs entered for the third day in a row, raising $773.47 million. Total inflows into these ETFs over the last three trading days exceeded $1.8 billion, according to CoinGlass data.

This level of activity reflects growing institutional appetite for Bitcoin, fueled by hopes for regulatory clarity and increased accessibility to crypto-focused financial products.

So where does this leave Bitcoin? As institutional interest, ETF inflows, and market enthusiasm continue to gain momentum, breaking the $100,000 mark looks more like a “when” than an “if.” But as Bitcoin moves forward, what about altcoins?

How do Bitcoin options increase volatility?

While spot Bitcoin ETFs have played a large role in the recent rally, options trading on these funds has brought a new layer of excitement and impact to the market.

One notable example is BlackRock’s iShares Bitcoin Trust ETF (IBIT), which launched options contracts on November 19. The results were amazing.

By the end of the first trading day, IBIT options had captured approximately $1.9 billion in notional exposure through 354,000 contracts (289,000 call options and 65,000 put options), Bloomberg ETF analyst James Seyffart reported.

UPDATE: Final count $IBITThe first day of options trading had just under $1.9 billion in notional exposure traded through 354,000 contracts. 289k were Buys and 65k were Puts. This is in the ratio of 4.4:1. These options were almost certainly part of the transition to the new. #Bitcoin today is an all time high pic.twitter.com/IN3s9hajJ2

— James Seyffart (@JSeyff) 19 November 2024

The intense interest in call options, which accounted for nearly 80% of IBIT’s options activity on the first day, indicates a strong bullish sentiment among market players.

To put this in perspective, this level of activity dwarfs the $363 million raised on the first day of trading for the ProShares Bitcoin Strategy ETF (BITO), the first Bitcoin futures-based ETF in the US.

Another Bloomberg analyst, Eric Balchunas, highlighted the unprecedented scale of IBIT’s launch, saying the $1.9 billion exposure on the first day was “unheard of.”

$1.9 billion for Day One is unheard of. For context, $BİTO It earned $363 million and has been that way for four years. And this is valid with a limit of 25,000 contract positions. However, $1.9 billion is not a huge figure yet, for example $GLD I earned 5 billion dollars today, but I gave it a few more days/weeks. https://t.co/nAr2rracjb

— Eric Balchunas (@EricBalchunas) 19 November 2024

Moreover, BlackRock’s IBIT continued its dominance, generating another $1.9 billion of notional exposure on November 20. Bloomberg ETF analyst James Seyffart noted in a tweet that IBIT accounted for 97% of the total options volume across all Bitcoin spot ETFs that day.

point #bitcoin Yesterday’s ETF options volume breakdown was MAJORLY skewed to the right $IBIT. Ironically, IBIT traded much the same as on the first day, at around $1.9 billion in notional exposure, but took 97% of the volume. Hopefully these arbs/quants etc. It is slightly balanced with pic.twitter.com/OtNSGLVbRn

— James Seyffart (@JSeyff) November 21, 2024

To make things even more intense, Grayscale has also stepped into the options arena and announced that its Bitcoin spot ETF products ($GBTC and $BTC) will be available for options trading starting today, November 21.

Bitwise’s Bitcoin ETF does the same, offering similar options and products designed to help investors hedge their positions and implement advanced strategies.

$100k BTC: Are we there yet?

Bitcoin sits on the brink of an unprecedented milestone: $100,000. With its current price hovering between $96 and $97,000, it looks like the crypto giant is just inches away from moving into six-figure territory.

A court in Shanghai recently clarified that while businesses are restricted from engaging in crypto-related activities, it is not illegal for individuals to own crypto.

Judge Sun Jie of the Shanghai Songjiang People’s Court shared this perspective through an article on the official WeChat account of the Shanghai High People’s Court.

China has historically been a wild card in crypto markets. Every time there is news of acceptance or clarity from such a large market, global confidence in Bitcoin increases.

The timing couldn’t be better, as this announcement coincides with Bitcoin’s record price increase and sends a strong signal that crypto adoption is slowly progressing, even in restrictive environments.

Meanwhile, in the US, Bitcoin ETFs have shattered expectations.

Bloomberg’s Eric Balchunas highlighted that total assets under management for Bitcoin ETFs have reached a staggering $104 billion, supported by $30 billion in inflows year-to-date; This figure is twice as high as initial estimates.

Speaking of the “100” milestone, US bitcoin ETFs hit $100 billion in assets (though more like $104 billion, given the overnight price surge), and YTD flows are flirting with $30 billion (double our estimate). They are now 97% on their way to overtaking Satoshi as the largest investor and 82% on their way to overtaking gold ETFs. pic.twitter.com/Y3070yW7Jx

— Eric Balchunas (@EricBalchunas) November 21, 2024

To put this in perspective, these ETFs are now 97% on their way to surpassing Satoshi Nakamoto as the largest holder of Bitcoin and 82% on their way to surpassing gold ETFs.

Adding to the bullish sentiment, U.S. Senator Cynthia Lummis is advocating for Bitcoin on a national level. Lummis proposed creating a strategic Bitcoin reserve earlier this year and has since linked Bitcoin to strengthening the US dollar and relieving the national debt.

I wish there was a way to get our nation out of debt while maintaining the strength of the U.S. dollar. Wait. #BITCOINact

— Senator Cynthia Lummis (@SenLummis) 19 November 2024

His last tweet hinted that Bitcoin could be a potential solution to the national debt crisis, with the slogan “#BITCOINact”.

But Miles Deutscher noted an intriguing trend: Retail investors, buoyed by ETF flows, are snapping up BTC, while whales — large Bitcoin holders — are selling aggressively.

very interesting $BTC data.#Bitcoin While whales are selling aggressively, retail (spot ETFs) are buying aggressively.

ETF flows need to remain strong, otherwise selling pressure from long-term investors could catch up with the market. pic.twitter.com/oZSkCQT5mv

— Miles Deutscher (@milesdeutscher) November 21, 2024

This conflict between whales and retail traders creates some uncertainty. For Bitcoin to maintain its momentum and break $100,000, ETF inflows need to keep pace. If long-term investors continue to sell and ETF purchases slow, there could be turbulence in the market.

Still, the bullish momentum is undeniable and BTC could surpass $100,000 at any time. However, nothing is guaranteed in the crypto market, so prepare yourself for sudden changes.

Will altcoins be in the spotlight?

As Bitcoin heads towards the $100,000 milestone, the big question is: What happens next?

Crypto markets are known for their cycles where Bitcoin often takes the lead before handing the baton to altcoins.

A tweet from leading crypto analyst Michaël van de Poppe summarizes what could happen in the coming days: a dramatic price surge in Bitcoin, a significant decline in altcoins, followed by the start of an explosive alt season.

The theory is still valid $BTC.

We will experience a massive downward sweep/sudden impact. #Altcoins to fall en masse.

After this point –> the rotation game begins and we experience a multi-month sub-season.

Before that happens, $100k per Bitcoin is just around the corner. pic.twitter.com/LxRzxwMPaB

— Michaël van de Poppe (@CryptoMichNL) November 21, 2024

The theory suggests that Bitcoin may experience a sharp pullback (a sudden drop in price) after crossing the $100,000 threshold. This is not as remote a possibility as it seems.

Historically, Bitcoin has seen similar corrections during periods of rapid growth. For example, in the 2021 bull run, Bitcoin faced multiple pullbacks of 20-30% before resuming its upward path.

While such corrections often shake short-term investors, they provide entry points for new investors, sparking the next leg of the rally.

Given the current bullish momentum, a pullback could cause pressure to disappear from the market. But given strong institutional inflows through ETFs and firms holding retail demand, any potential decline is likely to be temporary.

The broader narrative – the increasing adoption of Bitcoin as a mainstream asset – remains intact.

Altcoins often follow in the footsteps of Bitcoin but also have their own dynamics. If Bitcoin experiences a sudden crash, altcoins could experience an even sharper decline.

This is because altcoins generally have lower liquidity and higher volatility compared to Bitcoin. However, such declines often herald an altseason, which is a period when altcoins outperform Bitcoin in terms of percentage gains.

The idea of ​​a multi-month subseason is not new. Past market cycles show that altcoins tend to rebound after Bitcoin’s dominance stabilizes or declines.

For example, in early 2021, Bitcoin reached an all-time high of $64,000 in April, and then its dominance fell from over 60% to below 50%.

This shift marked the beginning of a major altcoin rally, with Ethereum (ETH), Binance Coin (BNB) and smaller altcoins reaching record highs in the months that followed.

The same picture may occur again. Bitcoin’s dominance is currently high, supported by institutional demand and interest in ETFs.

Once Bitcoin surpasses $100,000 and its price stabilizes, investors may begin rolling their gains into altcoins, triggering a new wave of growth in the broader crypto market.

While optimism is high, the risks are just as real. The volatility of the crypto market can lead to dramatic fluctuations, making a balanced and well-researched approach essential.

Whether you are looking at Bitcoin or planning to dive into altcoins, the coming days may present opportunities; But trade wisely and never invest more than you can afford to lose.

Disclosure: This article does not constitute investment advice. The content and materials on this page are for educational purposes only.