After hitting a record high of $103,000 last week, Bitcoin has stabilized around the psychologically important $100,000 mark, with a market cap of $1.99 trillion, according to CoinMarketCap.
This stability is supported by several key factors, most notably institutional adoption and rising demand from Bitcoin exchange-traded funds (ETFs).
Institutional investors, including ETFs and major companies like MicroStrategy, have played a crucial role in supporting Bitcoin prices.
Since September, ETFs have added over 1 million Bitcoin to their holdings, while MicroStrategy and mining companies like Riot Platforms have boosted their reserves by hundreds of thousands of Bitcoins.
Riot, for example, holds 10,427 Bitcoin and plans to increase its holdings with $500 million in additional funding.
With the growth of ETFs, they have become an attractive way for institutional investors to gain direct exposure to Bitcoin.
These funds are competing with traditional assets such as gold and attracting large inflows, which is increasing and driving demand for Bitcoin to record levels.
Despite the strong bullish momentum since October, technical indicators such as the Relative Strength Index (RSI), which is currently at 76, show that Bitcoin is in an overbought zone.
This could lead to a short-term price correction if institutional demand does not continue at the same pace.
As the year comes to a close, the fundamentals appear to be supportive of Bitcoin鈥檚 positive trajectory.
However, the coin may face short-term resistance, as the continuation of the momentum depends on the sustainability of demand from institutions and ETFs, and under current conditions, the overall trend remains positive.
