Bitcoin's price jumped 12% over the week while related exchange-traded funds recorded their highest inflows since January, yet a leading cryptocurrency researcher cautions investors about celebrating too soon. Despite market optimism pushing toward the $100,000 milestone, 10x Research head Markus Thielen highlights that key stablecoin indicators remain worryingly subdued, potentially signaling limited sustainability for the current uptrend.
What to Know:
- Bitcoin trades at $93,700, up 11.8% over seven days, while spot Bitcoin ETFs recorded $912.7 million in single-day inflows
- Analysts see potential for Bitcoin to reach $99,000 based on technical patterns, but stablecoin minting activity remains concerningly low
- Market uncertainty has decreased following speculation about softening U.S. trade policies under President Trump
Stablecoin Activity Raises Red Flags
Thielen expressed significant reservations about the rally's staying power in his April 23 markets report. "Given that our stablecoin minting indicator has yet to return to high-activity levels, we remain cautious about the sustainability of the current Bitcoin rally," he stated.
This hesitation comes despite technical analysis suggesting Bitcoin could potentially reach $99,000 based on a bullish reversal pattern known as a falling wedge.
The relationship between stablecoin creation and cryptocurrency price movements represents a critical metric for evaluating market momentum. Stablecoin inflows "tend to correlate strongly with stickier money, while an increase in futures leverage could simply mean that fast traders are taking advantage of a quick move higher," Thielen explained.
This distinction matters significantly when assessing whether price increases reflect genuine investor commitment or merely short-term speculative activity.
Bitcoin's technical picture appears promising to many traders, with the cryptocurrency trading at $93,133 at publication time according to CoinMarketCap data. However, Thielen specifically highlighted "the absence of strong stablecoin inflows raises questions about follow-through" in sustaining the upward trajectory. The $95,000 level represents a key resistance threshold that could trigger automatic liquidations of short positions if breached, potentially accelerating price increases if overall market strength continues.
ETF Flows and Political Factors Fuel Optimism
Despite stablecoin concerns, institutional investment shows remarkable strength. U.S.-based spot Bitcoin ETFs recorded inflows of $912.7 million on April 22 alone, reaching levels not seen since mid-January according to data from Farside. This substantial capital influx suggests significant institutional confidence.
Swyftx lead analyst Pav Hundal characterized the situation positively, stating the ETF inflows indicate "this is a true, demand-led rally. Not just a hot flash of excited futures traders moving price." He further speculated about near-term price potential, adding: "If the news headlines finally quieten, we could break new highs sooner than everyone thinks. A fast track to $100,000 looks plausible, but things change quickly in a Trump presidency."
The cryptocurrency markets have experienced considerable volatility since early February when President Donald Trump imposed new tariffs. Recent market improvements coincide with speculation that the administration might be softening its stance on trade policies. Thielen suggested that "if uncertainty continues to decline, a further acceleration could provide the liquidity needed to support a more sustained rally."
Market participants remain particularly attentive to the critical $95,000 price threshold. This level represents not just a psychological milestone but a technical trigger point that could force automated liquidations of short positions, potentially creating a self-reinforcing upward spiral if the market maintains its current momentum.
Final Thoughts
While Bitcoin's impressive price gains and record ETF inflows signal growing institutional adoption, analysts remain divided on the sustainability of the rally. The lagging stablecoin activity highlighted by researchers suggests potential limitations to further upside, even as the market approaches the symbolic $100,000 mark amid easing political uncertainty.