The unwavering growth of Bitcoin indicates no room for a downturn any time soon. Trading at a price of $400 on Thursday morning, Bitcoin rocketed beyond $97000, propelling it to hit the milestone of $1,00000 any time soon. This would result in a push in Fully Diluted Valuation (FDV) beyond $2 trillion for the first time in history.
The existing pro-crypto stance in the US has resulted in rate cuts of government and federal reserves, contributing to the risk of trading. This has resulted in a surge in Bitcoin trade by around 30% in the last two weeks. According to trading insiders, Donald Trump’s victory in the recent election has significantly contributed to the trend, bracing an expectation for a crypto-friendly regulatory framework.
Apart from the Trump victory, the uptake of Blackrock’s physically settled IBIT option (which tracks Bitcoin’s prices) has resulted in an increased institutional interest rate, which played a crucial role in fueling the trend. The surreal trading volume of the IBIT option, crossing $2 billion from the first day of launch, has placed the iShare’s Bitcoin Trust ETF (IBIT) in the top 20 global list of most active non-index options.
The drastic increase in trade volume will foster room for diversified trading strategies and new demography for the Bitcoin platform, decreasing the volatility and associated risks. This definitely contributes to the increase in Bitcoin trade, considered a viable asset.
According to analyst predictions, with the policy shifts and institutional adoptions in favor of crypto innovations, the price of Bitcoin will reach as high as $200,000 in the coming months. The trajectory projection of Bitcoin is likely to create a financial landscape that brings the Bitcoin coin to the mainstream, which means a part of the day-to-day exchanges.
If BTC hits $100,000, reports from Coinglass indicate a risk of liquidation of around $5 billion worth of Bitcoins. This liquidation could result in buying pressure, pushing the prices even higher. 65% of cryptocurrency trade occurs on exchange platforms like OKX, Binance, and Deribit, shifting the institutional players to the mainstream market.
Amidst the Trump victory, news regarding the replacement of the SEC (Security and Exchange Commission) with the Commodity Futures Trading Commission as the regulator of the crypto platform has circulated the internet. The introduction of new regulatory policies will improve the stability of the crypto market, providing transparency and security. This would broaden the scope of digital assets in portfolios worldwide.
What is Fully Diluted Valuation (FDV) in crypto?
Fully Diluted Valuation is the total value of the cryptocurrency project, assuming all the tokens are in circulation. Investors use FDV to analyze the potential of the project. The total supply of tokens is affected by the minting or burning of tokens, causing a change in the numbers circulating. The growing value of crypto tokens is the result of technological advancements and market progress.
When more and more tokens are introduced in the market, the value of tokens will face a drop if there is no increase in demand as expected. Analyzing the FDV gives investors an insight into the project beyond the given point.
