Bitcoin has recently surged past the $124,000 mark, experiencing fluctuations that saw its value dip into the mid-$120,000 range within the last 24 hours. The digital asset hit record highs exceeding $126,000 earlier this week, but some investors opted to take profits amid a strengthening U.S. dollar, which has brought a challenge to the so-called “debasement-trade” dynamics.
As of the latest trading update, Bitcoin is valued at $123,962. The growing trend of using Bitcoin as a hedge against potential dollar devaluation—a strategy commonly referred to as “debasement trades”—has gained traction among investors. This week’s earlier price surge can be attributed to significant inflows into Bitcoin exchange-traded funds (ETFs) and market speculation around the weakening of fiat currencies, spurred by a prolonged U.S. government shutdown.
In a noteworthy observation, Bloomberg analyst Eric Balchunas reported that BlackRock’s Bitcoin ETF, designated as IBIT, led the way with an impressive $3.5 billion in weekly inflows, representing 10% of all total ETF net flows. Remarkably, all 11 original spot Bitcoin ETFs witnessed inflows, signaling robust investor demand. IBIT, launched just 21 months ago, is nearing $100 billion in assets under management and has become BlackRock’s most profitable fund, outpacing even its long-established products.
Despite this momentum, uncertainty surrounding the ongoing government shutdown—now in its second week—coupled with delays in crucial economic data releases has led some investors to gravitate toward safer asset classes. This shift has temporarily dampened Bitcoin’s appeal in the market.
Looking ahead, analysts forecast that Bitcoin may continue to trend upward. The recent correction, which saw prices drop to around $122,000, is viewed as a healthy adjustment and might pave the way for further gains. Current support levels are seen near the $120,000 mark, while resistance is estimated around $135,000. Market analyst Mags noted on social media platform X that “overall, dips are for buying,” suggesting confidence in a recovery.
Onchain data supports this optimistic outlook, with Glassnode reporting a significant increase in Bitcoin’s relative strength index, rising from 44 to 66 over the past week, indicating bolstered market confidence. The persistent U.S. fiscal standoff may be driving demand for perceived safe-haven assets. Commenting on future price potential, Geoffrey Kendrick, head of digital assets at Standard Chartered, mentioned that Bitcoin could reach $135,000 in the near term and even hit $200,000 by year-end if current market conditions hold.
In parallel, gold prices have been climbing, buoyed by increased central bank purchases and anticipations of future easing by the Federal Reserve. Furthermore, short-term Bitcoin whales—entities holding over 1,000 BTC acquired within the last five months—are currently enjoying substantial paper gains, estimated at roughly $10.1 billion, according to CryptoQuant.
