Bitcoin Rally May Be Driven by Liquidity Shortage and Whale Accumulation, Analysts Suggest

Key Points

1. Bitcoin's price strength in 2024 is supported by consistent negative exchange netflows, indicating a supply shortage on centralized exchanges.

2. Bitcoin's Stock-to-Flow (S2F) ratio has surged to 369.4K BTC, highlighting increasing scarcity and potential long-term price appreciation.

3. Whale accumulation has dominated market dynamics, with significant outflows from exchanges (-73k BTC) and mega whales (-19k BTC).

4. Bitcoin Spot ETFs have tightened liquidity, with institutional demand pushing holdings above 1.3 million BTC ($149 billion), further reducing spot market supply.

5. The rally's sustainability depends on continued demand, with potential for BTC to challenge the $117,000 resistance level if current trends persist.