Bitcoin (BTC) briefly tested below $91,000 on November 26 before recovering to the $95,000 level. The two-day 5% rally signaled a decoupling from traditional markets, particularly U.S. Treasuries. This change contrasts with last week, when the price of Bitcoin closely tracked the yield on the two-year U.S. Treasury note.
US 2-year maturity Treasury bond price vs. Bitcoin/USD. Source: TradingView/Cointelegraph
As investors move away from the “risk” perception of Bitcoin due to its strict monetary policy and censorship resistance features, the chances of it reaching $100,000 before the end of the year increase. Given that some of the world’s largest economies are facing growth challenges, investors are likely to seek refuge in the scarce asset, supporting Bitcoin’s performance.
On November 28, the yield on the 10-year government bonds of France, the euro zone’s second-largest economy, rose to 3%, matching the yield on Greek debt. According to CNBC, these data “show the extent of concerns about political turmoil in France as the government struggles to win support for its 2025 budget, which aims to cut spending.”
France’s budget deficit is expected to reach 6.1% in 2024, more than double the euro zone’s proposed limit of 3%.
In Russia, another global economic powerhouse, the domestic currency, the ruble, fell to its lowest level since March 2022, prompting central bank intervention. President Vladimir Putin was quick to dismiss concerns, even though inflation soared to 8.5% in October, CNBC reported. The central bank has raised interest rates to 21% but has yet to curb persistent price rises.
Bitcoin ETF inflows and miner accumulation have increased optimism.
Inflows into U.S. spot Bitcoin exchange-traded funds (ETFs) also helped improve investor sentiment, reversing a two-day negative streak on November 27.
Net inflows of $103 million went primarily to Fidelity’s FBTC and Bitwise’s BITB, while BlackRock’s main IBIT fund remained unchanged. This represents a significant reversal compared to the previous $548 million outflow on November 25 and November 26.
7-day average net flow from Bitcoin miners, BTC. Source: Glassnode
Bitcoin miners’ flows ended a 10-day average outflow, with deposits to miner-controlled addresses increasing, according to Glassnode data. This is an estimate that lacks official confirmation, but has nonetheless contributed to more optimistic market sentiment.
While miners’ accumulation typically signals confidence in the ongoing bull market, profit taking often creates unwarranted fear, uncertainty, and doubt, also known as FUD. To provide context, the 30-day average miner’s revenue is 476 BTC, meaning that at least 30% of outflows should be expected to cover costs.
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According to a report by Bernstein Research, MicroStrategy will control 4% of the total Bitcoin supply by the end of 2033, alleviating concerns about the company’s high premium over BTC holdings. The company currently holds a record 331,200 BTC in its treasury and plans to continue its strategy, which includes issuing debt and equity.
Bitcoin’s path to $100,000 will depend on how the U.S. economy and dollar react to current macroeconomic conditions. However, on-chain data and institutional interest remain strong, indicating strong bullish momentum that could propel BTC to new highs.
This article is written for general information purposes and should not be considered legal or investment advice. The views, thoughts and opinions expressed herein are those of the author alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.