Bitcoin Soars 9.5%, Analysts Predict Six-Figure Prices and Cash & Carry Strategy Offers Lucrative Returns 💰💸

The appealing return of the market-neutral cash and carry trade could attract additional funds to the cryptocurrency market.

Bitcoin sees largest one-day gain since October, market-neutral bets yield 3 times U.S. Treasury Notes.

(Source: TradingView)

Bitcoin 🚀 has experienced an impressive surge, rising 9.5% on Wednesday, marking its largest daily percentage gain since October 23, as reported by charting platform TradingView. This meteoric rise propelled prices to reach $64,000 on several exchanges, the highest level seen since November 2021.

Wall Street’s Embrace Boosts Bitcoin ETFs

This parabolic move from Monday’s low of nearly $51,500 has been largely attributed to Wall Street’s embrace of the spot-based bitcoin ETFs. As a result, the broader market gauge, the Blocking.net 20 Index, has also experienced a significant increase of over 10% this week.

The consensus among analysts is that this rally will continue in the coming months, with many predicting that Bitcoin prices will reach six figures. Bitfinex analysts anticipate a conservative price objective of $100,000-$120,000 to be achieved by Q4 2024, with the peak of the cycle expected sometime in 2025 in terms of total crypto market capitalization.

• Solana: A Rising Star in the Crypto Market Boom 🚀
• Coin Crash: Coinbase Outage Sparks Bitcoin Bull Run Speculations 🚀🐂
• Binance Faces Scrutiny in Nigeria: Suspicious Flows and Blockchain Battles 🇳🇬💰

🔮 “The ETFs have introduced ‘passive demand’ which means demand is coming from investors that is largely price agnostic. They perceive bitcoin as a store of value rather than a tradable volatile asset, which has been the case for several years before the introduction of the ETFs,” analysts added.

Bitcoin Could Reach $200,000 by 2025, Says Technical Analyst

Renowned technical analysis pundit Peter Brandt has even bolder predictions, suggesting that Bitcoin could peak at $200,000 by September 2025. These forecasts are sure to bring joy to directional traders, but non-directional traders need not feel left out either.

Cash & Carry Offers Lucrative Returns

For those looking to capitalize on the Bitcoin market without taking a directional position, the cash and carry arbitrage strategy is an attractive option. This market-neutral strategy seeks to profit from price discrepancies in spot and futures markets. By combining a long position in the spot market with a short position in futures, arbitrageurs can profit when futures trade at a premium to spot prices.

What makes this strategy particularly enticing is that the cash and carry arbitrage currently offers an annualized return of 14%, according to Glassnode, a blockchain analytics firm. In comparison, the yield on the 10-year U.S. Treasury note, considered a risk-free rate, is only 4.27%. This means the cash and carry strategy provides three times the yield of the U.S. Treasury note and 2.8 times the yield of the 1-year Treasury bond.

(Source: Glassnode)

The higher yield in the crypto market is likely to attract more investors. “The yield available in futures markets is likely to start attracting market makers back into the digital asset space, deepening market liquidity,” stated Glassnode in their weekly newsletter.

🤔 Reader’s Q&A:

Q: What are the key factors behind the recent surge in Bitcoin prices?
A: The recent surge in Bitcoin prices can be attributed to Wall Street’s embrace of spot-based Bitcoin ETFs, which has introduced passive demand from investors who now view Bitcoin as a store of value rather than a tradable volatile asset.

Q: How high can Bitcoin prices go in the future?
A: Analysts have varying predictions, with Bitfinex forecasting a price range of $100,000-$120,000 by Q4 2024, and technical analyst Peter Brandt suggesting a peak of $200,000 by September 2025.

Q: What is the cash and carry arbitrage strategy?
A: The cash and carry arbitrage strategy allows traders to profit from price discrepancies between the spot and futures markets. By combining a long position in the spot market and a short position in futures, traders can capitalize on futures trading at a premium to spot prices.

Q: How does the cash and carry strategy compare to traditional investments?
A: The cash and carry strategy currently offers an annualized return of 14%, which is significantly higher than the yield on the 10-year U.S. Treasury note and 1-year Treasury yield.

The Future of Bitcoin and Investment Strategies

With the increasing adoption of Bitcoin ETFs and the attractive returns offered by the cash and carry strategy, the future of Bitcoin appears promising. As more investors enter the market, market liquidity is expected to deepen, creating further opportunities for traders and investors alike.

As always, it is important to stay informed and stay ahead of the market trends. Keep a close eye on the latest developments in the world of cryptocurrencies and explore various investment strategies that align with your risk tolerance and financial goals.

References:

1. Blocking.net – Bitcoin Price | BTC Price Index and Live Chart
2. Peter Brandt on Blocking.net
3. TradingView
4. Glassnode

---

📢 Did you enjoy this article? Share your thoughts and spread the knowledge by sharing on social media! 🌐✨

We will continue to update Phone&Auto; if you have any questions or suggestions, please contact us!