Bitcoin (BTC) pierced $94,000 on Jan. 5, reaching its highest level since Dec. 10 and capping a rally that added nearly $100 billion to the total crypto market capitalization in 24 hours.
The move came as spot Bitcoin ETFs recorded their strongest inflows in three months, derivatives positioning turned aggressively bullish, and macro conditions created space for risk assets to rebound into the new year.
US spot Bitcoin ETFs logged $471 million in net inflows on Jan. 2, led by BlackRock's IBIT, helping push BTC back over $90,000 into the weekend and setting the stage for today's breakout.
The ETF demand arrived amid institutional flows returning after year-end consolidation, a January effect following the heavy outflows that defined late 2025.
The combination of renewed institutional appetite and thin post-holiday liquidity allowed the inflows to drive prices more decisively than they would under normal trading conditions.
Derivatives markets amplified the rally through a familiar feedback loop.
Options traders piled into upside calls clustered around the $100,000 strike, with open interest on Deribit jumping and total January options open interest reaching approximately $1.45 billion.
CoinGlass data shows that over $438 million in short positions were liquidated over the past 24 hours, forcing additional buying as Bitcoin broke through resistance levels.
The short squeeze dynamics accelerated the move from the low $90,000s into the $94,000 range, with thin order books exaggerating each leg higher.
Additionally, the macro backdrop provided support from multiple angles.
Markets digested weaker-than-expected US manufacturing data, reinforcing expectations that the Federal Reserve can maintain its path toward easier monetary policy.
Macro tailwinds and bullish options outlook
Simultaneously, geopolitical risk spiked as the US launched operations targeting Venezuelan President Nicolás Maduro, prompting repositioning across asset classes.
Tech stocks rallied alongside traditional safe-haven assets like gold and silver, with Bitcoin catching bids as investors rotated into both growth and defensive positioning at the start of 2026.
The broader crypto market mirrored Bitcoin's strength, with total market capitalization climbing 3.1% to nearly $3.3 trillion.
Ethereum traded at $3,244, up 3.1% in the past 24 hours, while XRP posted the strongest gains among major assets with an 11.5% advance to $2.33. Solana rose 3.7% to $189, Cardano gained 5.2% to $0.8218, and Dogecoin added 2.6% to reach $0.1534. BNB climbed 2.2% to $915.
The ETF inflows, whale accumulation, and forced covering of short positions combined to generate the breakout, with relatively light resistance between $90,000 and $94,000 allowing the rally to develop momentum.
Options positioning reflects a bullish outlook, with call buyers betting on further upside through January expiries. Bitcoin has not closed above $94,000 since mid-December, when a brief spike to similar levels preceded a month-long consolidation phase.
The technical picture shows Bitcoin reclaiming levels it last held nearly four weeks ago, breaking through the $90,000-$92,000 range that had capped upside attempts through late 2025.
Whether Bitcoin can hold above $94,000 and challenge $100,000 depends on whether ETF demand continues at the Jan. 2 pace and whether macro conditions remain constructive.
Weaker manufacturing data support the case for Fed dovishness, but geopolitical developments introduce uncertainty that could swing sentiment either way.
For now, the combination of institutional inflows, derivatives positioning, and thin liquidity has driven Bitcoin back to levels last seen in mid-December.
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