Bitcoin Breaks $80,000! Euphoria Soars, But Risk Remains

Bitcoin Breaks $80,000! Euphoria Soars, But Risk RemainsOn November 11th, Bitcoin surged past the historic $80,000 mark and continued its upward climb, reaching $81,300 per coin by 5 pm, a 2.66% increase from the previous day

Bitcoin Breaks $80,000! Euphoria Soars, But Risk Remains

On November 11th, Bitcoin surged past the historic $80,000 mark and continued its upward climb, reaching $81,300 per coin by 5 pm, a 2.66% increase from the previous day. Trading volume skyrocketed as well, reaching $78.06 billion in the past 24 hours, a 63.87% jump. Market capitalization eclipsed $1.61 trillion, setting a new all-time high.

Cryptocurrency stocks also joined the frenzy. While the US stock market was yet to open for the week, pre-market trading saw significant gains for related companies, including Canaan Inc., MARA Holdings, Riot Platforms, and MicroStrategy. These stocks saw increases exceeding 15%, 13%, 12%, and 10%, respectively.

However, behind the euphoria, market risks remain. coinglass data shows that in the past 24 hours, 213,800 accounts liquidated, resulting in a total of $645 million in losses. Of this, $633 million was attributed to long positions, primarily due to the liquidation of long positions on various altcoin contracts. While Bitcoin liquidations were primarily driven by short positions, the total amount liquidated still reached $122 million, ranking first in terms of liquidation amount. Ethereum and Dogecoin (DOGE) followed closely with $90.76 million and $69.85 million, respectively, reflecting the intense market activity.

The Bitcoin Fear & Greed Index currently stands at 76, indicating extreme greed in the market. As the saying goes, "Greed runs rampant during bull markets, fueling a fear of missing out." With Bitcoin constantly setting new records, its sustainability and the permanence of the $80,000 mark are hot topics in the market.

Zhao Wei, Senior Researcher at OKX Research Institute, points out that the continuation of the upward trend depends on multiple factors, including future policies and economic conditions, inflow of funds into the crypto market, changes in traditional financial markets, and the crypto market cycle. He believes that the current market uncertainty stems primarily from future policies and regulations from the US and other major economies, especially regarding Bitcoin regulatory changes. "Some market analysts believe that Bitcoin prices may experience a period of high-level volatility and adjustment. Future support will depend on the policy environment and the inflow of funds. If the policy environment remains loose and the crypto market sees sufficient inflows, Bitcoin may maintain strong support above $80,000. However, as market volatility intensifies and Bitcoin prices remain at a high level, the risk of a decline and correction should be considered. Traders should be wary of rapid shifts in market sentiment," Zhao said.

Geoff Kendrick, Global Head of Digital Asset Research at Standard Chartered Bank, is more optimistic. He believes that Bitcoin will reach $125,000 by the end of this year and $200,000 by the end of 2025, following a potential victory for Donald Trump in the US presidential election. Kendrick argues that Trump's previous promises regarding cryptocurrencies, such as firing the SEC chairman, creating a national strategic Bitcoin reserve, and transforming the US into a "Bitcoin superpower," would drive Bitcoin's price up.

KiYoung Ju, founder of CryptoQuant, believes that the overheating of the Bitcoin futures market suggests an impending correction. He points out that Bitcoin is currently in a price discovery phase and the market is heating up further. He states that, if there is a correction and consolidation, the bull market could continue. However, a strong rebound at year-end might set the stage for a bear market in 2025.

The recent surge in Bitcoin has captured the attention of numerous market participants. Binance CEO Changpeng Zhao, in a social media post, commented, "With Bitcoin hitting new all-time highs, please use proper risk management. There will be many dips (and highs) ahead, make sure you can handle them. Control your greed, don't put all your eggs in one basket."

Zhao Wei reminds investors that Bitcoin, as a highly volatile asset, is significantly influenced by policies, market sentiment, and global economic events. Traders should be mindful of the impact of short-term market fluctuations on their investment decisions and avoid emotionally driven choices. Additionally, they should pay attention to policy and regulatory risks. Changes in the Fed's monetary policy, crypto regulations, and particularly the US economic policy following the presidential elections, could have significant implications for the crypto market. Traders need to stay vigilant about policy shifts to manage potential market impacts.

In conclusion, while Bitcoin's recent performance is strong, significant uncertainties remain surrounding its future prospects. Both the market environment and policy changes could influence its trajectory. Investors should approach investments rationally, exercise risk control, and avoid blindly chasing the upward trend.