Daniel Walker
Cryptocurrency markets extended their rally on Thursday following softer U.S. inflation data, boosted by renewed ETF inflows and growing expectations of interest rate cuts. Analysts warn, however, that soaring leverage across altcoins could trigger volatile swings.
Timothy Misir, head of research at BRN, said that a combination of favorable macro signals and Wall Street capital inflows sparked a broad risk-on rally. In comments shared with PRIME, he noted that Bitcoin reclaimed strength above $120,000 while Ether surged past $4,700, with U.S.-listed spot ETH ETFs acting as a major driver.
Spot Ether ETFs recorded $729 million in net inflows on Wednesday โ the second-largest daily figure ever โ pushing ETH closer to its all-time high. Bitcoin ETFs also saw inflows, though on a smaller scale compared to ETH-focused products.
Altcoin Leverage Reaches Unprecedented Levels
Post-inflation rally momentum โconfirms that policy relief and structural inflows remain central to this uptrend,โ Misir said. Still, he cautioned that record-high altcoin leverage combined with low implied volatility has historically preceded sharp market swings.
Data from Glassnode shows open interest in major altcoins has hit an all-time high of around $47 billion, with ETH options open interest climbing to $16.1 billion, close to yearly highs. Such positioning, coupled with options maturities at multi-year lows and minimal hedging activity, could pave the way for a volatility breakout if key resistance levels are breached.
Bitcoin Price Outlook
According to BRNโs analysis, Bitcoinโs short-term holder cost basis is hovering near $120,000, a critical level after briefly dipping to $112,000 last week. Most recent BTC buyers held their positions through the pullback, showing resilience in the market.
Misir suggested that a sustained consolidation around this cost basis could lay the foundation for another rally beyond Bitcoinโs $124,128 record high. โIf the price clears that barrier, the next target could be $144,000,โ he said.
