Analyst: This round of Bitcoin price increase is driven by position resets and reduced supply elasticity

Crypto News: On March 4th, according to Decrypt, Bitcoin’s rebound continues, breaking above $71,000 for the first time in three weeks. However, whether the rally can sustain depends on the overall liquidity environment and geopolitical risks. Altura co-founder and CEO Ranveer Arora stated, “ETF capital inflows continue to provide structural buying support, but more direct drivers seem to be position resets, reduced supply elasticity after the halving, and improved liquidity expectations. In the crypto market, once selling pressure is absorbed and positions start to rotate, leverage and derivatives capital flows often accelerate the price discovery process.” Arora believes Bitcoin’s movement remains closely tied to the global liquidity environment. He noted that Bitcoin’s performance “is less like a traditional defensive asset and more like a high-beta expression of global liquidity conditions.” Alex J., Chief Product Officer of LetsExchange, said Bitcoin’s rise to $71,000 was “mainly driven by escalating geopolitical tensions and rising uncertainty.” When asked whether this rebound can continue, Alex J. responded, “Probably not. But I don’t expect a significant drop either.” He explained that when the global financial system experiences severe turbulence that significantly impacts liquidity flows across different assets, Bitcoin struggles to compete with conservative assets like gold.