Bitcoin first breaks $97,000, hitting a new annual high, ETF massive inflows kick off a new cycle

The early morning crypto market was ignited by a sudden bullish candle, with Bitcoin prices breaking through the $97,000 mark for the first time in mid-January. According to Gate market data, as of January 15, 2026, Bitcoin is trading at $96,431.5, up 1.15% in 24 hours, with a 7-day increase of 5.52%.

The market celebration is not limited to Bitcoin; mainstream assets such as Ethereum, Solana, and others are generally rising, and the total cryptocurrency market capitalization has increased by over $250 billion at the beginning of 2026.

Price Breakthrough

Bitcoin has shown strong momentum at the start of 2026. On the evening of January 13, the market experienced a clear upward trend, with Bitcoin briefly reaching a high of $96,500. This breakout ended a consolidation period of approximately 56-58 days within the $94,000-$94,500 resistance zone.

According to the latest Gate data, Bitcoin’s 24-hour trading volume reached $1.53 billion, with market cap returning to $1.92 trillion, and market share steady at 56.38%. In the past 24 hours, prices fluctuated between $94,545 and $97,941.6, and the market sentiment indicator has shifted to “Neutral.”

Market Reaction

Bitcoin’s breakout quickly drove the entire cryptocurrency market higher. Ethereum rose 6.6% in a single day, while XRP and Dogecoin recorded gains of 4.6% and 7%, respectively. This broad rally reflects a significant improvement in market risk appetite.

Intense market volatility led to the liquidation of a large number of leveraged positions. Data shows that total daily liquidations exceeded $686 million, mostly from short positions, with approximately 126,000 traders facing forced liquidations.

The cryptocurrency fear and greed index, which measures market sentiment, jumped 11 points within 24 hours, from 26 (fear level) at the start of the year to 48 (neutral level), reaching the highest level since October 2025.

Core Drivers

This Bitcoin breakout is not accidental; it is supported by a series of fundamental and technical factors.

Spot Bitcoin ETF capital flows have undergone a fundamental shift. After the tax-loss harvesting at the end of 2025, institutional funds have re-entered the crypto market. Analysts note that some Bitcoin ETFs experienced the largest single-day inflows since October 2025. The sustained capital inflow may be stronger than market expectations. According to the latest report from K33 Research, ETF net inflows in 2026 are expected to surpass 2025 levels, signaling an institutional breakout.

A shift towards easing macroeconomic expectations is another key driver. The Consumer Price Index released by the U.S. Department of Labor on January 13 showed a year-over-year inflation rate of 2.7%, in line with expectations and not rising, reinforcing market expectations of further rate cuts in 2026. The prospect of the Trump administration appointing dovish Federal Reserve Chair also creates an “ample” monetary environment, which is positive for scarce assets like Bitcoin.

Technical rebounds and changes in market structure should not be overlooked. After a roughly 35% correction from the October 2025 high, a technical rebound has statistically become a high-probability event.

More importantly, the market structure is undergoing a qualitative change— with spot ETFs approved, increased adoption by sovereign nations, and continuous corporate treasury allocations, Bitcoin’s buying logic is shifting from “cyclical speculation” to “strategic asset allocation.”

Institutional Perspective

Professional institutions hold a constructive bullish outlook for Bitcoin in 2026. K33 Research predicts Bitcoin will outperform stock indices and gold, believing that regulatory victories will bring benefits that outweigh capital allocation effects.

Bernstein analysts are more optimistic, setting a target price of $150,000 for Bitcoin in 2026, with a peak of $200,000 in 2027. This forecast is based on sustained institutional entry, increased Bitcoin ETF holdings, and new capital inflows in 2026 as long-term bullish drivers.

Arete Capital partner McKenna, while noting that Bitcoin may face a short-term market correction risk of up to 31%, also expects prices to exceed $150,000 in the second half of 2026 and break $200,000 before the end of President Trump’s term.

New Supply and Demand Balance

In 2026, the crypto market may face a structural tightening of supply. Bitwise Asset Management’s latest outlook estimates that the total purchase volume of crypto ETFs listed in the U.S. in 2026 could surpass the total new issuance of BTC, ETH, and SOL for the year. The firm estimates that the new supply in 2026 will be approximately 166,000 BTC, 960,000 ETH, and 23 million SOL. As more institutions gain access to investment channels in 2026, ETF demand is expected to exceed this supply.

This shift in supply and demand is accelerating. Since the ETF listing in 2024, Bitcoin funds have accumulated a total of 710,777 BTC, while only 363,047 BTC have been mined during the same period, indicating that demand has significantly outpaced new supply.

Market Outlook

Looking ahead to 2026, multiple catalysts could continue to drive Bitcoin prices higher.

The regulatory environment is expected to become clearer. K33 Research predicts that the “Clarity Act” will pass in the first quarter of 2026, and broader crypto legislation will be signed early in the year, removing obstacles for larger institutional participation.

Participation from traditional financial institutions will increase significantly. Morgan Stanley plans to allow advisors to allocate 0-4% of client portfolios to Bitcoin ETFs starting January 1, 2026. E-Trade’s retail crypto trading is expected to go live in the first half of 2026. Meanwhile, the gradual opening of 401(k) retirement plans will bring a huge potential buying demand based on allocations of 1% to 5%.

On-chain data shows that the supply of Bitcoin held for more than 2 years will end its decline and is expected to rebound to over 12.16 million BTC by the end of the year, as early selling pressure diminishes and may turn into net buying demand.

Bitcoin prices have slightly retreated from the high to around $96,000, and the cryptocurrency fear and greed index continues to improve, with market sentiment turning neutral, laying a relatively positive foundation for the rest of 2026. Analysts from major institutions unanimously target $150,000 and even higher, and the core engine driving all this—the Bitcoin ETF capital inflow—is just beginning to demonstrate its true power.