New Delhi [India], October 30: Bitcoin has been making headlines once again with a surge in its price. Its movements are closely watched by investors, traders, and financial analysts. This year BTC has hit its all time high at $73,000 and is again gearing to hit another. 


Bitcoin is currently trading at the $71,000 level. BTC is up by more than 100% over the past year. 


This recent uptick is not an isolated event but rather the result of several converging factors, both macroeconomic and market-specific.
 
 Inflows into Bitcoin Spot ETFs 


Earlier this year, the US SEC approved 11 applications for Bitcoin spot ETFs, enhancing the legitimacy of cryptocurrency in the eyes of the public. As a result, many institutions have entered the market, with major players like BlackRock and Fidelity launching their services. So far this year, we've witnessed an impressive $86.75 billion flow into the market through these initiatives. With October alone contributing to $4.4Billion until now.  


Rising Global Liquidity


Global liquidity has hit an all-time high, primarily due to actions of central banks like the Federal Reserve, People’s Bank of China, and European Central Bank cutting the rates. With this ease, more capital is available for investors, which means people are more likely to invest. 


This rise in liquidity is crucial for Bitcoin. Historically, Bitcoin bull markets have coincided with periods of increased global liquidity, as more capital tends to flow into riskier assets in search of higher returns. With global liquidity at record levels, institutional and retail investors are more likely to continue seeking Bitcoin as an alternative store of value.


Upcoming US Presidential Elections


Additionally, the upcoming U.S. presidential election could have a major impact on the crypto landscape. Potential changes to regulatory frameworks and market sentiment could further influence Bitcoin’s price trajectory, making it an important period to watch. US presidential candidate Donald Trump's pro-crypto stance and engagement with crypto voters have boosted Bitcoin’s popularity. Also, Kamala Harris’s announcement of coming up with crypto friendly regulations also added to the sentiment.
 
 Weakening U.S. Dollar Index (DXY) 


One of the most significant indicators to watch is the U.S. Dollar Index (DXY), which measures the dollar’s value against six major currencies, including the Euro, Japanese Yen, British Pound, Canadian Dollar, Swedish Krona, and Swiss Franc. Historically, a weaker dollar has often been correlated with a stronger Bitcoin. The reason behind this is quite straightforward—when the dollar declines, investors tend to seek alternative assets like Bitcoin that can act as a hedge against inflation and currency devaluation. 


In September and early October, the DXY showed signs of weakness. If this trend persists, we could see more capital flow into cryptos being an alternative investment class, driving up their prices. 


Changing Dynamics Between Short-Term and Long-Term Holders


Short-term holders, who have held Bitcoin for less than 155 days, have been reducing their net positions recently. This indicates that many of these investors are realizing profits. 


Conversely, long-term holders are steadily increasing their positions, showing confidence in Bitcoin despite price fluctuations. The growing positions of these long-term holders are often viewed as a bullish signal. Their ongoing accumulation suggests they see the current price levels as an opportunity, anticipating future growth. Historically, this shift from short-term to long-term holders has often been followed by a market bottom and a subsequent surge in Bitcoin’s price as stability returns.


A Confluence of Factors Driving Bitcoin’s Surge


Bitcoin’s recent surge is not the result of a single factor but rather a confluence of macroeconomic trends and internal market dynamics. Understanding these factors can give investors valuable insights into Bitcoin’s market movements and help them make informed decisions. Crypto investing can feel challenging, especially during times of volatility. That’s where platforms like Mudrex come in—offering crypto investment solutions and insights that help diversify and manage risk effectively.  


This article is written by the Mudrex Research Team. Mudrex is an Indian crypto exchange that makes investing in crypto simple and accessible. It offers an easy way to trade with features like UPI payments, INR support, and minimal fees. With a focus on security, compliance, and advanced trading tools, Mudrex is designed to help Indian users confidently start their crypto journey.