Historic high! Bitcoin tops $126k on institutional inflows, debasement bets

Bitcoin continued its strong upward momentum, hitting a new all-time high of $126,198 on October 7, eclipsing its previous peak of $125,559 recorded just a day earlier. The surge comes amid sustained institutional inflows, as investors grow increasingly optimistic about potentially supportive signals from the US Federal Reserve.

 

The bullish sentiment wasn't limited to Bitcoin alone. Ethereum reclaimed the $4,700 level, while BNB (Binance Coin) soared to a new all-time high above $1,200. Analysts attributed the broader rally to the ongoing US government shutdown, which has amplified concerns over economic stability. This, they say, is fueling the so-called “debasement trade,” where investors turn to crypto assets as a hedge against potential currency devaluation and fiscal uncertainty.

 

 

Despite the rally, signs of profit-booking have emerged at higher levels. At last check, Bitcoin was trading 0.35 per cent higher at $124,261.27, with a 24-hour trading volume of approximately $69.14 billion, according to data from CoinMarketCap. Over the past 24 hours, the asset has fluctuated between $123,340 and $126,198. Bitcoin's market capitalisation has now climbed to $2.47 trillion, reinforcing its dominance as the world’s largest digital asset.

Bitcoin eyes $129,000

The rally in the flagship currency, according to the CoinSwitch Markets Desk, was buoyed by the strong institutional inflows and a weak US dollar. "The ongoing US government shutdown reinforced the broader 'debasement trade', driving parallel demand for both crypto and gold."

 

While institutional inflows continue at record levels, macro cues, Edul Patel, CEO of Mudrex, said, take center stage as markets anticipate supportive signals from the Fed. A dovish tone in September’s FOMC minutes and softer US jobless claims, Patel believes, could extend Bitcoin’s rally towards $129,000.

 

"Meanwhile, with the Dollar Index down 10 per cent this year, any further weakness increases the appeal for Bitcoin as a hedge, attracting even retail investors into the rally," said Patel.

 

That said, on-chain data points to sustained accumulation, with exchange reserves continuing to decline. From a technical perspective, Bitcoin is seeing resistance near $127,000, while support levels are clustered between $120,000 and $122,000. Momentum indicators such as the MACD remain positive.

 

"A decisive breakout could set the stage for a move toward $130,000 and beyond, whereas failure to clear resistance may prompt a near-term correction," said analysts at CoinSwitch Markets Desk.

Ethereum, other altcoins rally

The bullish sentiment further extended towards altcoin cryptocurrencies as well. Ethereum (ETH), which enjoys the position of the second-largest cryptocurrency by market cap, was trading with gains of 3.88 per cent at $4,708—merely 5 per cent shy of its peak of $4,953 scaled on August 25, according to CoinMarketCap.

 

The currency has oscillated between $4,511–$4,736 in the last 24 hours.

 

In the altcoins space, Starknet (STRK), MYX Finance (MYX), Mantle (MNT), Stacks (STX), Bittensor (TAO), Astar (ASTER), PancakeSwap (CAKE), Pudgy Penguins (PENGU), Bonk (BONK), Chainlink (LINK), Pendle (PENDLE), dogwifhat (WIF), Lido DAO (LDO), Sonic (S), Arbitrum (ARB), Dogecoin (DOGE), Hedera (HBAR), Ondo (ONDO), Quant (QNT), Algorand (ALGO), Worldcoin (WLD), Polkadot (DOT), Kaspa (KAS), Sei (SEI), Celestia (TIA) were the other gainers, rising up to 23 per cent.

 

Conversely, Zcash (ZEC), Hyperliquid (HYPE), Pump.fun (PUMP), Aptos (APT), Litecoin (LTC), SPX6900 (SPX), Curve DAO Token (CRV), Monero (XMR), ether.fi (ETHFI) were the laggards, logging intraday losses of up to 7 per cent on CoinMarketCap.