Bitcoin (BTC) is down 0.5% over the last 24 hours to trade at $89,077, 4.5% below its $93,434 all-time high.
Despite this pullback, optimism around a possible crypto-friendly Donald Trump administration, rising stablecoin inflows into exchanges, steady inflows into the spot Bitcoin exchange-traded funds (ETFs) and several onchain indicators suggest that the bull market is not over.
High stablecoin inflows to fuel Bitcoin rally
Bitcoin’s 17% uptick over the last seven days was accompanied by an influx of stablecoins into cryptocurrency exchanges, according to data from market intelligence firm CryptoQuant.
“Stablecoins entering spot exchanges act as fuel in the market,” said pseudonymous CryptoQuant analyst theKriptolik in an insight note on Nov. 15.
To confirm whether Bitcoin’s bull run will continue, the analyst examined the number of stablecoins entering spot exchanges and found that “there is a continuation of a higher-than-normal influx of stablecoins.”
“This suggests that, barring any additional news flow, the Bitcoin bull market has not yet ended.”
ERC-20 stablecoin flows into exchanges. Source: CryptoQuant
Historically, price rallies have been preceded by large-scale inflows of stablecoins to exchanges. For example, the 2021 bull run was preceded by an influx of stablecoins that occurred between September 2020 and February 2021.
Most recently, high stablecoin inflows into spot exchanges occurred between January and early March this year, resulting in a rally that saw Bitcoin’s price break previous all-time highs before the Bitcoin halving.
If stablecoins continue flooding exchanges, it would indicate investors’ intention to buy, adding to BTC’s demand-side pressure.
Demand for Bitcoin remains high
The crypto community believes that Trump’s second term as president of the United States could usher in a new era for the crypto market.
In a note to investors, QCP Capital expressed confidence that the underlying strength in Bitcoin represents a “systematic shift in the market in anticipation of Trump’s return to office.”
The crypto community is now looking forward to Trump’s fulfilment of his campaign promises and their possible implications, QCP Capital added.
“His idea of launching a strategic BTC reserve and rotation from gold to BTC provides a strong narrative that keeps BTC prices supported.”
Meanwhile, the Coinbase Premium Index, a metric that tracks the Bitcoin price difference between Coinbase and Binance, has hit its highest level since April, indicating strong US demand.
The chart below reveals that as Bitcoin stormed past $90,000 to set a new all-time high at $93,434, United States demand surged, pushing the Coinbase Premium Index to 0.13, levels last seen on April 14.
Bitcoin Coinbase Premium Index. Source: CryptoQuant
Increasing demand is evidenced by massive inflows into US-based spot Bitcoin ETFs, with more than $4.7 billion being poured into these investment products after the US presidential…
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