Bitcoin Nears Record High: Shiba Inu Alarms

SHIB futures open interest exceeds $100 million, suggesting speculation. Bitcoin's supply-demand imbalance has reached 1:10, signaling a record gain this week, according to one analyst. As bitcoin {{BTC}} approaches record highs, the crypto market is experiencing speculative excess, indicating caution for bulls.

According to CoinGlass, the notional open interest in perpetual futures contracts for meme cryptocurrency shiba inu {{SHIB}} has surpassed $100 million for the first time since August 2023. SHIB futures are 1,000 SHIB contracts with 25 times leverage.

SHIB's market cap rose 130% to $13.44 million in seven days, outperforming the CoinDesk 20 index's 22% growth. An increase in open interest and market value brings additional money into SHIB. Not just SHIB is hinting at speculation. 10X Research reports South Korean volumes of $8 billion or more per day, up from $1 billion per day before the bitcoin bull run.

“There is a wave of retail activity occurring from altcoins to meme-coins,” Markus Thielen, founder of 10X Research, said of Korean exchange market volume growth. Bitcoin may reach a new high above $69,000 this week as inflows into U.S. spot ETFs exceed the number of BTC produced daily, Thielen said. That increased the supply-demand imbalance to 1:10.

Over-the-counter (OTC) trading desks serve major institutional clients, and their aggregate inventory data shows balances have dropped from approximately 10,000 Bitcoins in Q2 2023 to fewer than 2,000. This means Bitcoin ETF issuers and their market makers must buy Bitcoins directly from exchanges. Thielen said the daily mined vs. daily ETF demand supply/demand ratio is 1:10.

Grayscale's spot ETF (GBTC) lost $600 million on Thursday, its largest single-day redemption in over a month. According to 10X Research, BlackRock's IBIT inflows dropped to $202 million on Friday after three days of $500-600 million.

Thielen believes the slowdown is a month-end phenomena and that big inflows may return this week. This week, BlackRock inflows should restart

Bitcoin will rise if Grayscale's flows dip below $100m, Thielen said. Bitcoin traded at $63,300 at press time, up 2% in 24 hours and 22% in 7 days.

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