Bitcoin's recent price movements are largely influenced by a significant shift in institutional investment trends. Hopes for a strong recovery are being tempered as data reveals a sharp decline in the very demand that fueled previous rallies.
Institutional Demand Dries Up
BlackRock’s weekly spot BTC ETF inflows have plummeted by a staggering 90%, from over 10,000 BTC to just 600 BTC in recent weeks. This dramatic reduction signifies a cooling interest from major institutional players, including treasury firms like Michael Saylor’s Strategy, who are no longer aggressively acquiring Bitcoin. Analysts initially pointed to long-term holders selling as the cause for price pressure, but a clearer picture emerges: the primary challenge is the insufficient institutional capital to absorb current sell pressure, significantly impacting Bitcoin’s ability to sustain price levels above $100,000.
Mid-Term Caution, Long-Term Potential
From an on-chain perspective, the mid-term outlook remains cautious, with current demand proving inadequate to counteract selling pressure, which contributes to price declines. Yet, the long-term view carries a note of potential. While the overall rate of demand growth has slowed, historical data shows that a "Negative Apparent Demand" signal has often coincided with local bottoms for BTC, hinting at future rebounds if past trends hold true. Adding to this, a key cycle top indicator, the MVRV Z-Score, has not yet signaled an overheated market peak. This suggests that the current consolidation phase might be a prelude to further price appreciation, rather than an indication of the bull cycle's end, with a 50/50 chance for continued multi-month consolidation.
