- On-chain activity remained subdued, with retail wallets quiet and fees low, while large entities repositioned amid volatility.
- Profitability metrics weakened as supply in profit declined, NUPL trended toward loss, and realized profit and loss balanced.
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Bitcoin's BTC/USD market structure remains fragile, with bearish pressures dominating across spot, futures, and on-chain metrics, according to a Glassnode report.
What Happened: Despite brief relief from renewed ETF inflows, weakening demand, reduced profitability, and fading conviction across trading venues point to a defensive market stance.
The report noted Bitcoin's pullback to $107,000, testing the short-term holder cost basis, a key battleground for sentiment.
Historically, this level has marked inflection points between bullish recoveries and further downside.
Spot market activity showed weakening conviction as relative strength index levels slipped into oversold territory and volumes contracted.
While cumulative volume delta hinted at easing sell pressure, overall demand remains fragile.
Futures positioning reinforced the defensive tone.
Open interest declined, funding rates eased, and perpetual CVD showed modest improvement.
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Traders were less willing to extend leverage, reflecting fading risk appetite after recent volatility.
Options markets highlighted caution, with falling open interest and narrower volatility spreads suggesting waning participation.
However, downside hedging demand surged, with 25-delta skew reaching historical extremes, signaling strong protection-seeking behavior.
ETF flows turned modestly positive, offering temporary support.
Still, trade volumes shrank and market value-to-realized value (MVRV) ratios declined, pointing to profit-taking and selective institutional engagement rather than broad confidence.
On-chain demand signals remained subdued, with low activity among retail wallets and fees staying depressed.
Large entities increased transfer volumes, but grassroots participation showed little sign of strengthening.
Capital flow metrics underlined waning conviction, as realized cap inflows slowed and speculative short-term holder supply rose relative to long-term holder supply.
Profitability also weakened, with declining percent supply in profit and net unrealized profit/loss trending closer to loss territory.
What’s Next: Glassnode concluded that while temporary rebounds remain possible, market sentiment overall is defensive.
Without stronger demand, risks remain skewed toward further consolidation.
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