The recent Crypto Market Compass report released by Bitwise Europe suggests a possible surge in Bitcoin’s value. According to the report, all major factors, including risk appetite, liquidity, and macro momentum, are currently favoring Bitcoin, potentially setting up a significant boost for the leading cryptocurrency. The report highlights Bitcoin’s recent rebound from $101,000 to approximately $108,000 within a week, a result of a blend of declining inflation, improving geopolitics, and an increasingly dovish stance by the Federal Reserve.
The report indicates that Bitwise’s own Cryptoasset Sentiment Index has soared to its highest level since May, signaling a bullish sentiment. This surge is a result of an influx of capital into exchange-traded products. The total net inflows into global Bitcoin ETPs have reached a record high of $14.3 billion this year, with the last five sessions contributing another $2.2 billion, equivalent to roughly 20,763 BTC.
Why the sudden shift towards risk? Bitwise attributes this to a reduction in macro uncertainty. New US trade agreements with Canada could be finalized in July, and the US and Iran have adopted surprisingly reconciliatory tones. Additionally, Federal Reserve Chairman Jerome Powell has linked the resumption of rate cuts to progress in tariff talks, opening the possibility of a looser policy in the coming weeks.
According to Bitwise, this combination of declining geopolitical risks, uncertain trade policy, and potential monetary policy stimulus should continue to improve market sentiment and provide a significant boost for Bitcoin and other cryptocurrencies.
On-chain data also seems ready for a surge. Large-volume Bitcoin wallets withdrew 8,740 BTC from exchanges last week, exchange reserves dropped to 2.898 million BTC, and net selling pressure on spot venues decreased from $2.2 billion to $0.5 billion.
While derivatives present a more complex picture, with futures open interest dropping by 20,000 BTC and bearish perpetual funding rates hinting at a lingering short bias, options markets show traders quietly retracting.
Bitwise concludes that as long as geopolitical détente, trade breakthroughs, and an accommodating Federal Reserve coincide with continuous ETF inflows, global risk appetite is likely to return decisively, keeping Bitcoin on an upward trajectory. At the time of writing, Bitcoin is trading at $106,840.
