Bitcoin Demand Surge Signals Potential Rally Toward $200K

Bitcoin demand has been quietly accelerating since July, creating conditions that analysts say could fuel another major rally by year-end. According to CryptoQuant, apparent demand has been expanding at an impressive pace of about 62,000 BTC per month. This growth mirrors the backdrop seen in late 2020, 2021, and 2024—periods that preceded sharp upward price movements.

The biggest drivers of this surge appear to be whales and ETFs. Large-holder balances are climbing at an annualized pace of 331,000 BTC, stronger than the 255,000 BTC growth seen in Q4 2024 and far above the contraction of 197,000 BTC in 2021. ETFs have also played a critical role, purchasing 213,000 BTC in Q4 2024 alone, representing a 71% increase in holdings. With institutions likely to boost allocations into year-end, analysts see this as a key factor that could push the market higher.

For this demand to translate into another breakout, momentum remains essential. On-chain data highlights the Trader’s Realized Price of $116,000 as the critical threshold. A decisive move above this level would officially shift the market back into the “bull” phase of the Bitcoin Bull-Bear Cycle Indicator, potentially opening the door to a valuation range of $160,000 to $200,000.

The indicator measures bitcoin’s market price against various realized price metrics, effectively tracking the average cost basis of investor groups. A climb above these levels historically signals rising profits and renewed bullish momentum.

As October unfolds, market conditions look strikingly similar to last year. CryptoQuant’s Bull Score Index has been holding between 40 and 50, levels that often precede bullish transitions. In Q4 2024, a break above 50 coincided with bitcoin’s rally from $70,000 to $100,000. With demand from whales and ETFs already strengthening, traders are now watching closely for a repeat rally that could carry bitcoin toward the highly anticipated $200,000 mark.