Bitcoin (BTC) successfully regained the $102,000 milestone on January 6, climbing 4% during the day amid an overall market surge, with accumulation continuing to outstrip profit-taking, according to data from CryptoSlate.
At the time of writing, the leading cryptocurrency was priced at $101,630 after struggling to maintain its upward movement as US markets closed. This rebound occurs as sell-side liquidity continues to tighten, as detailed in the latest Bitfinex Alpha report.
Bitcoin’s reentry into the $102,000 range follows a substantial 15% correction from its all-time high (ATH) of $108,100, reached on December 17, 2024. This correction occurred after a notable 61% surge ignited by the US election results on November 6, 2024, indicating strong market optimism.
Although analysts initially forecasted a more significant pullback in the first quarter, the report indicated that new metrics imply much of the bearish influence may have significantly weakened.
Record Low Sell-Side Liquidity
A principal factor influencing Bitcoin’s price is the swift decline in sell-side liquidity. The Liquidity Inventory Ratio, a measure of how long the existing supply can meet market demand, has collapsed from 41 months in October to just 6.6 months.
This drastic reduction mirrors the liquidity constraints observed during Bitcoin’s price surges in the first and fourth quarters of the previous year, indicating limited availability during peak demand periods.
Furthermore, miners, a key source of sell-side pressure, have influenced current liquidity trends as their spot selling has decreased following the 2024 halving.
Traditionally, miners liquidate Bitcoin to support their operations and upgrade equipment, but flows from miners to exchanges have significantly slowed since April 2024. While miner flows rose in November of last year, these levels are still far below historical highs.
Bitfinex reports that miners are currently in a robust position, buoyed by considerable unrealized profits. Their holding patterns have further tightened liquidity, reinforcing Bitcoin’s upward momentum.
Data indicates a broader trend where miners are retaining their Bitcoin holdings in anticipation of price increases or to optimize their strategies in favorable market conditions.
Strong Start to 2025
The report emphasized that Bitcoin is commencing 2025 on a solid foundation, as reflected by positive on-chain metrics. The declining sell-side liquidity will play a crucial role in Bitcoin’s price fluctuations.
Although the possibility of a more profound pullback remains, liquidity metrics at multi-year lows and miners displaying confidence through their holding strategies suggest that much of the selling pressure has lessened, paving the way for additional potential gains.
Bitcoin Market Data
As of 10:10 pm UTC on January 6, 2025, Bitcoin holds the #1 rank by market cap, with the price showing a increase of 3.33% over the last 24 hours. Bitcoin has a market capitalization of $2.01 trillion and a 24-hour trading volume of $51.66 billion. Learn more about Bitcoin ›
Crypto Market Summary
As of 10:10 pm UTC on January 6, 2025, the total cryptocurrency market is valued at $3.58 trillion with a 24-hour trading volume of $132.93 billion. Bitcoin dominance currently stands at 56.23%. Learn more about the crypto market ›
