Institutional Interest Surges As Bitcoin Crosses $35K, Triggering $275M Liquidations: Market Update

Last week, Bitcoin (BTC), the world's largest cryptocurrency by market capitalization, experienced a meteoric surge when it traded above the $35,000 price level, resulting in $275 million in liquidations. This surge also piqued the interest of institutional investors.

Bitcoin trading beyond the $35,000 threshold marked a level not seen in 17 months and elicited mixed market reactions, as reported by Bitfinex.

The recent uptick was responsible for the $275 million in short positions liquidated on October 23 alone, making it the most significant event in the market since the beginning of the year. According to the report, this development "aligns with the recurring themes of increased volatility and volume in the entire cryptocurrency sector."

The following day, on Oct. 24, another $153 million in liquidations occurred as Bitcoin steadily surged. Market volatility and sharp intraday pullbacks were credited for this trend.

Within just two days, the market witnessed a total of $200 million in long liquidations, including $130 million on Oct. 24.

Additionally, the report highlighted that October is a "pivotal month for Bitcoin," which has seen an increase in institutional involvement.

The Bitcoin options volume on the Chicago Mercantile Exchange is set to close the month at its highest ever, with more than $2 billion in monthly volume. This signals "a resurgence in market activity and the ever-growing appeal of Bitcoin to institutional investors."

Signs of gradual recovery are also observed in options open interest, with a listing of $1.15 billion for this month, approaching its all-time high of approximately $1.69 billion. This suggests a revival in institutional interest.

The Bitcoin options volume on the Chicago Mercantile Exchange is set to close the month at its highest ever, with more than $2 billion in monthly volume. This signals "a resurgence in market activity and the ever-growing appeal of Bitcoin to institutional investors."

Signs of gradual recovery are also observed in options open interest, with a listing of $1.15 billion for this month, approaching its all-time high of approximately $1.69 billion. This suggests a revival in institutional interest.

According to Bitfinex analysts, "October is on the verge of registering an increase of more than 27 percent following a green September. This is the second-highest monthly growth for the asset this year." The analysts explained in a note seen by International Business Times, "Historical monthly returns data indicates that if October shows growth, November often follows suit. Specifically, in 6 out of 10 instances, the bullish trend of October extended into November."

The analysts also noted that this means there is a 60% likelihood that November will be a positive month for BTC.

While a substantial number of investors are currently in profit, long-term holders are seeing minimal gains, which is typical following a sharp spike and is usually followed by a phase of sideways correction or movement, as the analysts explained.

The analysts further noted, "Heavy profit-taking from any group is typically followed by sideways movements or corrections, but this phenomenon does not usually occur before significant market tops are reached. Currently, long-term holder Bitcoin balances and SOPR values remain much lower compared to previous periods. Therefore, while investors should prepare for some sideways movement, the analysts believe that we are still in the early stages of a bull market."