Bitcoin Bull Run in the Making as Market Dynamics Hint at More Upside: Bitfinex

Cryptocurrency exchange Bitfinex has released a report relaying its belief that the digital asset market may be in the early stages of a bull run.

According to the latest edition of the Bitfinex Alpha report, several dynamics like bitcoin’s (BTC) ascent to the $35,000 price range and increasing institutional interest in the leading digital asset show that the market is gearing up for a bull phase.

Bitcoin’s Surge and Large Liquidations

Bitcoin’s surge to the $35,000 range on October 23 was followed by a chain of mass liquidations. A staggering $275 million worth of short trades were wiped out on the same day and $153 million the day after. Bitfinex found that the number of liquidations was the largest seen by the market since January 2023, just like the price attained had not been seen in 17 months.

The market also recorded over $200 million in long liquidations as BTC retraced its steps amid the upward movement.

Bitcoin’s move was also accompanied by short-term holders – a cohort of investors who have held BTC for less than six months – realizing a significant amount of profits. The short-term holder Spent Output Profit Ratio surged intra-day to 1.059, the highest seen since April 11. As the metric moves above one when investors realize a profit on their holdings, the current value shows that short-term holders took the largest amount of profit since April.

“A significant proportion of investors are now in the green, yet long-term holder profit-taking is minimal. This kind of action is typical after a sharp uptick in a bull market and is often followed by a phase of sideways movement or correction,” Bitfinex said.

Increasing Institutional Involvement in Bitcoin

While BTC continues its ascent, institutional interest in the digital asset has increased. Bitcoin options monthly volume on the Chicago Mercantile Exchange is set to end October with $2 billion, its highest-ever reading. At the same time, options open interest is gradually recovering as it currently stands at a monthly figure of $1.15 billion, not too far from its all-time high of $1.69 billion.

Besides the bullish sentiment in the options market, on-chain data suggests that BTC could follow through with its upward momentum into November. Per historical data, the bullish trend of October has extended to November in six out of ten instances, meaning there is a 60% chance the pattern could be repeated.