Bitcoin made history on December 6, 2024, by crossing the $100,000 mark for the first time ever after it surged 32% over the past month, even while traditional assets like oil, gold, and the S&P 500 struggled to hold steady.
While oil prices dropped 6.3%, S&P 500 fell 1%, and gold lost 1% of its value, Bitcoin stood out, attracting attention worldwide.
Quinten François, co-founder of WeRate, shared his thoughts about the rally on X, he called this moment the start of Bitcoin’s “euphoria stage.” He explained in a social media post, “You have a maximum of 12 months before the cycle top,” referencing a phase in market cycles marked by peak investor excitement.
The “euphoria stage” is a period in the crypto market when excitement and optimism are high, and this often drives prices higher.
François found a basis for this prediction in the Net Unrealized Profit/Loss (NUPL) metric that shows whether more Bitcoin holders make a profit or are incurring losses. A high NUPL suggests that many holders of Bitcoin are in profit, and this will almost always push the prices up.
Additionally, liquidity, which is the amount of money circulating in the economy, has been decreasing in many parts of the world, making it more difficult for other markets to grow. Despite this, Bitcoin continues to perform well.
Jamie Coutts, a chief crypto analyst at Real Vision, described it saying, “Bitcoin has hit new ATHs in the face of a deteriorating liquidity backdrop. If conditions worsen, the rally, while euphoric, can only last for a limited time.” However, he also cautioned that worsening conditions could slow the rally, though improvements could send prices even higher.
However, Raoul Pal, CEO of Global Macro Investor, sees more records ahead. He believes Bitcoin could hit a “local top” of $110,000 by January 2025. pointing to the relationship between Bitcoin’s growth and global money supply, or M2 liquidity. In short, If this liquidity continues to improve, Bitcoin’s price could continue its upward trend.
Also Read: Bitcoin Rebounds Above $100K After Short Liquidity Grab
