From Cointelegraph · By Yohan Yun
Bitcoin’s days of consecutive double-digit price surges are over as Wall Street traders and profit-taking whales reshape the market, according to 10x Research founder Markus Thielen.
Institutional traders selling call options after rallies have made Bitcoin’s violent price explosions of earlier years less common, Thielen says in the latest episode of Cointelegraph’s Trade Secrets.
Thielen is also the author of Crypto Titans, a history of the industry. Writing the book led him to notice how each cycle brought different people pitching crypto to investors.
“Every cycle had actually different promoters, and different promoters bring in different investors,” he says.
This time, the promoters come from Wall Street, where investors trade on economic data and Federal Reserve decisions. Thielen says he expects Bitcoin will rise quickly on news, then spend time crab walking across the chart before the next big macro event.
Who’s really buying Bitcoin?
Thielen estimates that market makers account for up to half of the $60 billion in net spot Bitcoin ETF inflows he analyzed. Those firms hold ETF shares as a way to hedge their options trades, so the positions do not necessarily represent a bet that Bitcoin’s price will rise.
“So in the end it was not outright buying,” he says.
His estimate draws on a review of Form 13F filings, which disclose certain securities holdings of investment managers.
Cumulative net inflows into US spot Bitcoin ETFs. Source: Coinglass
Thielen says the first wave of funds into the ETFs also included retail investors buying through institutions and corporate vehicles. Some paid substantial premiums to the value of the underlying crypto holdings.
“I would still think the institutions could come. I would still think that some of the sovereign wealth funds could come,” Thielen says.
Bitcoin could reach $90,000 by year-end
Thielen still sees Bitcoin reaching $90,000 by year-end. He says a drop into the mid-to-high $70,000s could come first.
Bitcoin has already been trading in that range, falling to about $76,100 on Friday following Binance’s $6.3 billion hack. BTC finished October down 7.3%, according to Coinglass.
Thielen compares the recovery in prices over recent months with early 2023, when Bitcoin rose from around $20,000 to $30,000. He says the doubts surrounding this year’s rebound are familiar as investors scan for the next price drop and entry point.
“I think everybody sort of missed it. So everybody wants to buy again.”
BTC’s return to $90,000 may rest partly on how much further the Fed raises borrowing rates. The central bank increased its benchmark rate by a quarter of a percentage point in September, to a target range of 3.75%–4%.