Bitcoin Up Next To Hit ATH After Gold? Here Are The Key Factors Driving BTC Bullish!

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With Gold hitting an all-time high of $2,509.41 per ounce, analysts now expect Bitcoin to follow suit. Several factors are driving the Bitcoin rally which suggests that a new peak might be around the corner. Following are some reasons that explain why Bitcoin is heading towards the crucial milestone. 

Whales Buying the Dip!

A significant factor which is driving the surge in Bitcoin’s price is the continued drainage of BTC exchange balances. Over the last 30 days, exchanges have witnessed a reduction of 11,317.53 BTC. Bitcoin has also witnessed substantial accumulation by whales. 

There were strategic withdrawals from major platforms like Coinbase Pro and Bitfinex, accounting for over 23,000 BTC accumulation. The massive outflow suggests that traders are moving their BTC holdings into cold storage, depicting a strong belief in its long-term value. Also, long-term holders have reportedly bought the dip with over 500,000 BTC accumulated since July 30. 

M2 Money Supply Hitting ATH!

With the M2 Money supply hitting all-time highs, more money is being injected into the economy, which implies that there will be more money to spend on risk assets like Bitcoin. Historically, as and when the M2 Money supply has hit all-time highs, Bitcoin was seen catching up a couple of months later. The M2 Money supply has hit an ATH in January 2024 and crypto has started to move with it.

Bitcoin Halving 

Bitcoin halving is another reason why Bitcoin might be up for a massive bull run in the coming days. As evidenced in the previous halving, Bitcoin was seen consolidating for a short period after halving but after a year of halving, Bitcoin’s performance witnessed an increase by 8,839%, 285%, and 548% in 2012, 2016 and 2024 respectively. 

Mighty Bitcoin ETF Flows

Bitcoin’s recent price momentum is also driven by the robust inflows into BTC ETFs. The spot Bitcoin ETFs saw a total inflow of $35.9 million on August 16 alone, continuing a week of positive flows amounting to $32.4 million. BlackRock, Fidelity, Bitwise, and Ark contributed to this inflow with substantial investments, totaling $20.4 million, $61.3 million, $12 million, and $13.4 million, respectively. 

The inflows into these ETFs provide additional liquidity and buying pressure, which has a positive impact on Bitcoin’s price. 

Growing Institutional Adoption Of Bitcoin ETFs

Institutional adoption of Bitcoin ETFs has gained significant traction, as reflected by recent filings and disclosures. Goldman Sachs revealed in a 13F filing that it held substantial positions in various Bitcoin ETFs as of June 30, which included $238.6 million in iShares Bitcoin Trust, $79.5 million in Fidelity Bitcoin ETF, and other notable holdings.

Morgan Stanley also revealed its holdings of 5,500,626 shares of BlackRock iShares Bitcoin Trust, valued at $187.79 million. Also, pension funds are now considering these investments.

With the spot Bitcoin ETFs and the ETH ET approved, the likelihood of other ETFs popping up is really high. It is getting easier for institutions to invest through ETFs. 

Upcoming Presidential Elections

With the US Presidential Elections soon approaching, the market sentiment is highly influenced by the political sector. With Donald Trump’s pro-crypto stance and Kamala Harris’ crypto reset, this could be another reason driving Bitcoin bullish. 

Donald Trump had stated that he is laying out plans to ensure that the US will be the crypto capital of the planet and the bitcoin superpower of the world! When he got shot recently, the market started skyrocketing as the market was pricing in a Trump Presidency. 

Also, historically, elections have been pivotal moments for financial markets, often leading to increased volatility. 

Fed Rate Cut Expectations

The expectations of a potential Federal Reserve rate cut are providing a significant blow for Bitcoin price. Market participants are increasingly betting on a rate cut at the upcoming FOMC meeting.

According to the CME FedWatch Tool, there is a 75% probability of a 25 basis point cut. Whilst, 25% of market participants expect a 50 bps cut. A rate cut would likely weaken the US dollar and boost assets like BTC.

These were some key factors that could potentially drive Bitcoin to its next All time high, driving a bullish run in the market.