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Bitcoin remains firm under selling pressure as the price recovers towards the ATH. On November 19, Bitcoin price fluctuated near the historical peak when geopolitical tensions caused instability in risky assets. According to data from Cointelegraph Markets Pro and TradingView, BTC price rose 2.4% on the day, recovering from a slight decline as the Wall Street market opened.
The possibility of Bitcoin reaching the $100,000 price level has long attracted the attention of investors. While psychological milestones are often celebrated by individual investors, the key driving factor will come from institutional adoption and the development of the Bitcoin Derivatives market. Currently, the total open interest of Bitcoin Futures has reached 626,520 BTC (~$58 billion), up 15% in the past two months, indicating growing interest in derivative instruments. If Bitcoin reaches $100,000, the open interest will reach $62.5 billion, equivalent to 3.1% of the total $2 trillion Bitcoin market capitalization.
Compared to the S&P 500 index, the open interest of $817 billion only accounts for 1.9% of the $43 trillion market capitalization. This figure is expected to decrease as Bitcoin Spot ETFs are deployed, especially those that support direct creation to attract institutional investors. However, regulations do not guarantee widespread acceptance. For example, the Chicago Board Options Exchange (CBOE) previously offered Bitcoin Futures contracts from December 2017 to March 2019, but had to discontinue this product due to low demand.
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BingX Bitcoin Chart
BingX Bitcoin 1D Chart, November 20, 2024
The recent approval of Bitcoin Spot ETFs marks an important milestone but also emphasizes the need for deeper integration with traditional financial markets. Institutional adoption of Bitcoin is a key factor in turning the $100,000 Bitcoin milestone into sustainable market development for the Derivatives market. Spot ETFs may open up complex strategies like generating income through covered calls or hedging liquidity risk. As institutions increasingly view Bitcoin as a reserve asset, the Derivatives market will continue to evolve to meet their sophisticated needs.
For newcomers, the Futures market can sometimes be confusing, especially regarding short positions. Many believe that short positions reflect bearish sentiment, but this is not always the case. Strategies like "cash and carry" generate a large number of short contracts, where investors lock in risk-free profits by selling Futures while holding the Spot Bitcoin. These strategies not only help stabilize the market but also do not have a speculative price-depressing nature.
Potential game-changing drivers for Bitcoin's price may come from corporate governance changes. For example, Microsoft shareholders recently voted to allocate funds to Bitcoin, indicating serious intent from influential investors. While the plan may not be approved in 2025 or may be rejected by the board, this move creates momentum that could put pressure on other companies to follow suit. Additionally, Senator Cynthia Lummis' proposal to convert the U.S. Treasury's gold certificates into Bitcoin and create a "Strategic Bitcoin Reserve" is another catalytic factor. This bill includes a plan to purchase 5% of the total Bitcoin supply—equivalent to 1 million BTC—to be held for 20 years, further solidifying Bitcoin's position as a reserve asset.
While there is excitement surrounding Bitcoin's journey to $100,000, the Derivatives market tends to react to broader adoption rather than drive it. The concern of individual and corporate investors about the devaluation of fiat currency remains the primary driver pushing Bitcoin's price higher. More than any Futures product or Spot ETF, this shift in mindset will be the decisive factor in making Bitcoin an essential part of institutional investment portfolios.
Currently, the support level for Bitcoin is $88,500 and the resistance level is $93,000.
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