Bitcoin is pushing above $124,000 after touching the mid-$120,000’s in the last 24 hours.
Bitcoin hit record highs above $126,000 earlier this week, but it seems investors took some profits and a strengthening U.S. dollar challenged the so-called “debasement-trade” flows. At the time of writing, bitcoin is trading at $123,962.
Many investors have started to use bitcoin as a hedge against a potential devaluation of the dollar, known in trading circles as “debasement trades.”
The surge earlier in the week was fueled by heavy inflows into Bitcoin exchange-traded funds (ETF) and speculative bets on fiat currency weakness amid a prolonged U.S. government shutdown.
According to Bloomberg analyst Eric Balchunas, BlackRock’s IBIT led all ETFs in weekly inflows with $3.5 billion, accounting for 10% of total ETF net flows. All 11 original spot Bitcoin ETFs also saw inflows, showing a strong demand for Bitcoin ETFs.
Launched only 21 months ago, IBIT is approaching $100 billion in assets under management, making it BlackRock’s most profitable fund — surpassing even products that have been around for over 20 years.
However, uncertainty around the ongoing government shutdown — now in its second week — and the delay of key economic data has prompted some investors to seek safer assets, temporarily weighing on Bitcoin’s appeal.
Will bitcoin go higher?
Analysts say the recent correction, which brought Bitcoin down to the rough $122,000 range, is healthy and may set the stage for further gains.
Support currently holds near $120,000, while resistance is seen around $135,000. “Overall, dips are for buying,” noted market analyst Mags on X.
Onchain data reinforces strong buying momentum. Glassnode reports that Bitcoin’s relative strength index rose from 44 to 66 over the past week, signaling growing market confidence.
The ongoing U.S. fiscal impasse may be further fueling demand for perceived safe-haven assets. Geoffrey Kendrick, head of digital assets at Standard Chartered, suggested that Bitcoin could reach $135,000 soon and possibly $200,000 by year-end if current market conditions persist.
Gold has also continued its upward trajectory, supported by central bank purchases and expectations of future Fed easing.
Meanwhile, short-term Bitcoin whales — entities holding over 1,000 BTC acquired in the past five months—are sitting on roughly $10.1 billion in paper gains, according to CryptoQuant.