Bitcoin has reached a historic milestone, breaking past the $120,000 mark for the first time, as sustained demand from institutional investors and record-setting inflows into spot Bitcoin exchange-traded funds (ETFs) continue to drive the market higher.
The flagship cryptocurrency surged over 8% in the past 24 hours, extending its year-to-date gains to over 85%. Analysts attribute the rally primarily to persistent capital flows into recently approved U.S.-based Bitcoin ETFs, which have attracted billions of dollars in assets under management since their launch.
“The ETF inflows have dramatically changed the market structure,” said Lisa Thornton, a digital assets strategist at Arcadia Capital. “We’re seeing long-term institutional capital entering Bitcoin in a way we’ve never seen before—this is not retail-driven mania.”
The inflows have also tightened supply, as ETF issuers continue accumulating Bitcoin to meet investor demand. This, combined with the recent halving event in April, which cut the block reward to 3.125 BTC, has created a favorable supply-demand dynamic.
Market participants also point to a broader shift in sentiment toward crypto assets, supported by macroeconomic conditions such as moderating inflation, interest rate cut expectations from the Federal Reserve, and growing interest in Bitcoin as a hedge against currency debasement and geopolitical instability.
While enthusiasm remains high, some analysts caution that volatility is likely to persist. “We’re in a historic price discovery phase, but leverage and speculative behavior are also increasing,” warned Sofia Mendes, head of research at NovaChain. “Investors should be prepared for significant corrections along the way.”
Bitcoin’s rally is also lifting the broader crypto market, with Ethereum climbing past $6,500 and several altcoins posting double-digit gains.
As Bitcoin continues to break records, attention is now turning to whether it can sustain momentum beyond $120,000—or if profit-taking and regulatory headwinds will spark a temporary cooldown.
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