Bitcoin's Surge: Demand and Volatility Point to New Heights

Bitcoin (BTC) has recently reached a new all-time high as of November 6, driven by significant institutional and retail capital inflows alongside rising market volatility. According to Glassnode’s latest report, during the past month, Bitcoin experienced net capital inflows totaling $2.5 billion, leading to a 3.8% increase in its market Realized Cap, which now stands at a record $656 billion.

Options Driving Volatility

The options market reflects Bitcoin's upward trend, with open interest levels nearing record highs at $25.2 billion, just shy of the all-time peak of $30.2 billion recorded in March. Additionally, options trading volume surged to $2.9 billion, indicating heightened investor interest in Bitcoin's future price movements. Notably, the volatility risk premium (VRP) is currently at 27.9%, suggesting traders anticipate significant price fluctuations in the near future.

ETF Demand Remains Strong

Despite some fluctuations, demand for Bitcoin-based ETFs remains robust. While US-listed Bitcoin ETFs experienced outflows of nearly $658 million from November 4 to 5, overall, there were over $2.2 billion in inflows recorded for the week, highlighting sustained investor interest. On November 6, BlackRock’s IBIT ETF saw over $1 billion in trading volume within the first 20 minutes, suggesting that previous inflows may continue. Glassnode notes that achieving this new all-time high could attract even more ETF investors drawn by Bitcoin's strong upward momentum.