Bitcoin, Ethereum, and other major cryptocurrencies saw moderate gains early Wednesday, supported by strong exchange-traded fund inflows and easing geopolitical tensions.
According to The Block's crypto price page, bitcoin rose 2.2% in the past 24 hours to trade at $78,015 as of 4:30 a.m. on Wednesday. Ethereum rose 2.7% to $2,386 in the same period, and the broader crypto market was up 2.3%.
"Crypto's upside reflects a confluence of easing geopolitics, strong ETF inflows, and constructive positioning," said Zeus Research Analyst Dominick John. "As Bitcoin broke above $75K, short positions were liquidated, triggering a mechanical squeeze."
Spot bitcoin ETFs have reported three straight weeks of net inflows, drawing in around $1.8 billion worth of capital. Plus, Michael Saylor-led Strategy has recently purchased additional bitcoin, surpassing BlackRock to become the largest institutional bitcoin holder.
Earlier today, U.S. President Donald Trump announced that he will extend the ceasefire with Iran to allow time for negotiations between the two countries, easing concerns over the approaching ceasefire expiry. However, Iran reportedly responded critically, accusing the U.S. for continuing to block Iranian ports.
Meanwhile, K33 Research said that bitcoin is likely to maintain its upward momentum, with a high possibility of more short squeeze events in the near term.
"Funding rates moved further lower over the past week, while prices climbed to three-month highs. Open interest continues to trend with higher highs and higher lows," the K33 report said. "Gradually rising leverage alongside deeply negative funding rates suggests that short positions are steadily building in perps, increasing both the likelihood and potential magnitude of a short squeeze ahead."
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Improving sentiment
The easing of risks tied to the ceasefire deadline appears to have bolstered crypto market sentiment. The Fear & Greed Index reflects the improvement, rebounding to 33 — back into "fear" territory — from an "extreme fear" low of 8 at the start of April.
"A Crypto Fear & Greed Index reading of 33 reflects a fear regime, but the uptick signals improving sentiment and a gradual re-risking bias rather than outright bullish euphoria," John said.
Still, the current rally appears limited to the short term. A shift toward a full-scale bull cycle would require a combination of sustained positive developments across the market., analysts said.
"Bitcoin needs to hold key breakout levels around $78,000 to $83,000, keep spot demand absorbing supply, and see confirmation from stronger liquidity, sustained altcoin participation, and a more stable macro backdrop," LVRG Research Director Nick Ruck told The Block.
