After a long time of prices staying pretty stable in December, Bitcoin and other big cryptocurrencies went up in early Asian trading. Bitcoin went up to more than $92,000, and ether went up to more than $3,100. The gains came after oil prices fell and the stock markets around the world got stronger.
The move was affected by the timing of the market. Prices changed after news came out that the U.S. had arrested Nicolás Maduro, the president of Venezuela. That event had an effect on a lot of different types of assets, including commodities and risk assets. Crypto also moved in the same direction. The price movement gave talks about a possible change in market conditions at the start of the new year more energy.
The rally was helped by a number of structural factors. The end of the year tax loss selling had stopped, which had been a common reason for prices to go down. People in the market also talked about the possibility of a new U.S. crypto-related bill, which sparked more interest in digital assets. These events happened at the same time as falling oil prices, which many people see as a sign of disinflation.
The January 5 market update from QCP said that lower energy costs usually make people less worried about inflation. At the same time, people started talking again about Venezuela’s possible bitcoin holdings. Traders are saying that the country might have a reserve that is about the same size as Strategy’s. These claims have not been proven true yet.
There are rumors about Venezuela’s bitcoin reserves that fit with reports that the country is using cryptocurrency for business. Some oil deals have reportedly used USDT since 2024. At the same time, people are starting to think that any bitcoin that is taken from Venezuela could be sent to a U.S. strategic reserve. This belief has made people less worried about large-scale forced selling entering the market.
Derivatives trading also showed that people were feeling better. Options data showed that put skew was going down across a range of maturities, which means that there was less demand for downside protection. Over the past week, more than 3,000 bitcoin call options with a strike price of $100,000 and an expiration date of January 30 were also bought.
If spot prices keep going up, this concentration of call buying makes it more likely that prices will move again. This kind of positioning makes it more likely for a gamma-driven extension to happen, where options hedging activity makes price rises even bigger.
As the year begins, spot market gains, geopolitical events, macro signals, and derivatives positioning all worked together to make the crypto markets look better.
Source: https://news.bitcoin.com/crypto-rallies-as-venezuela-shock-shifts-risk-mood/
