Bitcoin Price Rally Driven by Fresh Capital, Not Leverage

Bitcoin's recent price surge to nearly $79,000 has surprised many in the market, but top analysts say that lower leverage was key to this rally. According to Santiment, coin-denominated open interest fell by about 11% to roughly 312,600 BTC during this period, marking a one-month low.

This trend is in stark contrast to traditional rallies where increased leverage fuels the price advance. However, in this case, fresh capital entered the market without a significant rise in leveraged positions, as reported by CryptoQuant.

The influx of new money into U.S. spot Bitcoin ETFs added another source of demand during the rebound, with almost $1 billion moving in over a recent three-day period, the strongest such inflow since Bitcoin last traded above $80,000.