Will Bitcoin’s $120,000 surge lead to new price discoveries?

Bitcoin ($BTC) made history early Friday, soaring to an all-time high of $120,000 before easing slightly to around $117,300. by the afternoon.

This remarkable price surge pushed Bitcoin’s market capitalisation to an eye-watering $2.3 trillion. In doing so, it has overtaken some of the world’s biggest companies, including Alphabet, Meta, Berkshire Hathaway, and Saudi Aramco.

Bitcoin’s sharp rise, which has seen it gain over 26% so far this year, has not only dominated the headlines but also drawn in massive institutional investment. 

While Bitcoin was the star of the show, several other cryptocurrencies and exchange-traded funds (ETFs) joined the rally, marking a milestone week for the entire crypto market.

While Bitcoin grabbed global attention by breaking $120,000, it was not the only digital asset setting records. 

Other cryptocurrencies with market capitalisations over $300 million – including Hyperliquid ($HYPE), FastToken ($FTN), Saros ($SAROS), GHO ($GHO), and BUILDon ($B) – also reached new highs this week. Smaller altcoins followed suit, with many hitting all-time peaks.

Despite this wider boom, Bitcoin was the only asset among the top ten largest cryptocurrencies to trade at a record level this week, underlining its dominance in the market.

A mix of economic and financial factors has helped lift Bitcoin. Major stock indices like the S&P 500 have hit record highs, while international markets, including Hong Kong’s Hang Seng index, are trading close to peak levels.

This broad “risk-on” atmosphere has pushed more money into riskier assets like cryptocurrencies. Adding to the momentum, a wave of public companies has been buying Bitcoin in large quantities.

Firms such as MARA Holdings, Riot Platforms, Galaxy Digital, and GameStop have significantly increased their Bitcoin holdings, doubling the number of publicly traded companies with Bitcoin on their balance sheets over the past six months to at least 147.

Spot Bitcoin ETFs have also seen steady growth this year, with the number of Bitcoin held in these funds climbing 12%, from 1,123,110 to 1,257,338. 

Alongside these financial developments, Bitcoin has gained political favour, with several governments announcing plans to hold strategic Bitcoin reserves. Even Donald Trump’s company has joined the Bitcoin investment wave, adding a political dimension to Bitcoin’s remarkable rise.

ETFs, short squeezes, and macro factors fuel gains

Bitcoin’s record-breaking run came after a series of rapid developments. Thursday alone saw a 5% price jump, much of it driven by massive inflows into Bitcoin ETFs. 

According to Coinglass, Thursday recorded the largest daily short liquidation in four years, wiping out roughly $2.42 billion in short bets against Bitcoin.

The rally began after the US Federal Reserve released meeting minutes on Wednesday, showing a divided view among officials over the pace of interest rate cuts.

Some wanted to move slowly, while others pushed for faster action. Markets interpreted this uncertainty as a green light, and Bitcoin, along with tech stocks, began to climb.

The CEO of 10x Research, Markus Thielen, pointed to this as the moment traders broke past the “top range”. He added, “We also know that saving the budget deficit has sort of been pushed under the rug”, referring to the ‘One Big Beautiful Bill Act,’ which could widen the federal deficit and push more money towards Bitcoin.

Short liquidations added to the surge. Over the past 24 hours, more than $650 million in Bitcoin short positions were cleared, forcing traders to buy back Bitcoin and driving prices even higher. Ethereum ($ETH) was not spared, with $215 million in short bets liquidated during the same period.

ETF inflows have picked up sharply since mid-April, after Donald Trump hinted at removing Federal Reserve Chair, Jerome Powell. Since then, Bitcoin ETFs have pulled in nearly $16 billion, reflecting a surge of institutional interest.

With a potential crypto bill nearing approval in Congress and more companies adding Bitcoin to their holdings, the rally has continued to gather strength. However, Thielen cautioned that global events could bring sudden changes. 

“Powell might turn dovish end of the month at the Fed meeting, and maybe he will not”, he said, highlighting the need for investors to stay alert.

Seasonal factors may also play a role. Markus noted that summer often leads to reduced trading activity among equity investors, which could either stabilise Bitcoin or introduce more volatility.

Record ETF demand signals growing institutional confidence

Bitcoin’s trading activity has reached levels not seen in months. Over the past 24 hours, more than $81 billion worth of Bitcoin changed hands, according to CoinGecko. 

This level was last seen in January ahead of Donald Trump’s second inauguration and in February when Bitcoin briefly dipped to $84,000.

Binance’s regional growth and operations lead in South Asia, Kushal Manupati, emphasised that institutional investors are playing a key role in the current rally. 

“Bitcoin inching towards the $120,000 mark, hitting an all-time high at $118,000, marks a pivotal moment for the virtual digital assets industry. Institutions are showing confidence to enter the space at scale, bringing not just liquidity but long-term credibility to the space”, he said.

Analysts at Singapore-based QCP Capital pointed to another optimistic indicator: copper prices. Known as “Doctor Copper” for their ability to signal economic health, copper prices have climbed 8.42% in the past five days, suggesting stronger industrial demand and improved liquidity conditions.

Meanwhile, Bitcoin exchange flows,which is the amount of BTC moving onto exchanges for trading, have dropped to their lowest point in three years, now at $2.39 million, according to CryptoQuant.

The chief analyst at Bitget Research, Ryan Lee, said, “Given these conditions, Bitcoin is well-positioned to break its previous high in July, with upside potential toward $120,000 by month-end”.

Thursday saw a massive $1.18 billion flow into US Bitcoin ETFs – the biggest single-day haul of the year. BlackRock’s IBIT led the pack with $448 million, followed by Fidelity’s Wise Origin at $324 million. 

Ethereum ETFs saw strong activity too, with BlackRock’s Ethereum Trust (ETHA) pulling in $300.9 million, its best day yet.

The demand for ETFs is outpacing the creation of new coins. Over the past 24 hours, only $6.33 million in new Ethereum entered circulation, compared to $383 million in ETF demand. 

For Bitcoin, US ETFs and companies like Strategy have absorbed $28.22 billion year-to-date, while miners have issued only $7.85 billion, according to Galaxy Research.

While institutional demand is booming, many mainstream investment platforms, such as Vanguard, still do not offer crypto ETFs, keeping some potential investors on the sidelines. 

Meanwhile, Donald Trump’s media company has filed with the US Securities and Exchange Commission to launch a “Crypto Blue Chip ETF”. 

The proposed fund would hold 70% Bitcoin, 15% Ethereum, 8% Solana, 5% XRP, and 2% Cronos – a dramatic move from a president who once called Bitcoin “a scam”.

Under Trump’s administration, the SEC has pulled back on several crypto enforcement actions and introduced more ETF-friendly rules, helping reposition crypto as a legitimate digital asset sector.

Bitcoin has doubled in price over the past year and now trades at an average of $117,850. Its 24-hour trading volume has surged 99% to remain above $123 billion, while the overall cryptocurrency market has grown to $3.67 trillion in total value. 

Trading volume across the crypto market has jumped 67% to hit $246 billion, and Bitcoin’s dominance has risen to nearly 64%.

With Bitcoin breaking into uncharted territory, some analysts are predicting even higher targets – with $200,000 price forecasts starting to surface once again. 

While the future remains uncertain, one thing is clear: Bitcoin has entered a new era of market power, reshaping both the crypto industry and its position on the global financial stage.