Strong Investor Demand Meets Weak Bitcoin Futures as Price Slumps
Despite a Bitcoin price slump and negative funding rates suggesting bearish conviction, steady institutional buying limits the odds of a major correction.Summary
Bitcoin failed to surpass $71,000, coinciding with a drop in the US stock market and Bitcoin funding rates falling to -7%, indicating that short sellers were paying longs, which suggests high bearish conviction. However, the derivatives market shows only moderate stress, with the monthly futures premium remaining below the neutral 5% threshold. This sluggishness is not fully justified by worsening economic conditions, as tech stocks are also near highs. A key factor undermining Bitcoin's appeal as a store of value is the rising yield on US bonds (reaching 3.80%) and the strength of gold, which demand higher returns from alternative assets. Despite these headwinds, strong institutional demand, evidenced by consistent Bitcoin spot ETF inflows and MicroStrategy accumulation, is keeping sellers in check. This sustained buying pressure suggests that sellers below $75,000 may eventually be exhausted, paving the way for a sustained bull run, though bulls might need to wait until after March to challenge the $78,000 resistance.
(Source：Cointelegraph)