Bitcoin drops to 78 billion dollars: Increasing pressure from macro winds and ETF flows

In recent weeks, cryptocurrency markets have experienced a significant decline due to macroeconomic uncertainties and shifts in investor expectations. Bitcoin’s price, which recently fell from around $90,000 to $78,000, indicates that the broader market has also witnessed a similar downturn. Notably, the once common daily ETF inflows totaling around $500 million have become very rare. While such high-volume flows have historically been a major driving force behind the market, recent months have shown a clear weakening of this dynamic.

Fed Decision and Macro Upswing: Why Is the Market Cautious?

Bitcoin’s recent downward movement cannot be explained solely by sector-specific factors. Following the Federal Reserve’s interest rate cut, disagreements among policymakers about the next steps emerged. Fed officials signaled that only one rate cut in 2026 would be sufficient, shattering previous expectations of a more easing-friendly outlook. Meanwhile, negative movements were also observed in Nasdaq futures; especially after Oracle’s earnings failed to meet targets, market sentiment deteriorated rapidly.

Investors began reducing their positions, anticipating that this negativity in the stock markets would spill over into crypto assets. The overall downward pressure on risk assets appears to be a natural consequence of this. Additionally, the decline in implied volatility (IV) indices suggests that the market is not expecting a calm period; rather, it indicates that more uncertainty is on the horizon.

$500 Million Threshold and Slowing ETF Flows: Critical Signal

In the decentralized finance world, institutional investor behavior often influences pricing mechanisms. Particularly, inflows into spot Bitcoin ETFs have been among the strongest drivers over the past two years. However, data shows that this dynamic has changed dramatically. According to information compiled by SoSoValue, there have been days since November 11, 2024, when no net daily spot ETF inflows exceeding $500 million were observed in the US. The previous similar period was October 7 — roughly a month apart.

Understanding what this means requires historical context. Between April and October 2024, weekly inflows at this $500 million level occurred once or twice a week. During that period, Bitcoin’s price rose from $70,000 to $126,000. Today, such large institutional inflows have become much rarer. Analysts emphasize that this “hunger” for large inflows is a negative sign for prices; without buying pressure, price increases become significantly more difficult.

Smart Money Accumulation, Retail and Short-term Players Retreat

Although the macro picture appears negative, some bright spots remain. According to an analysis by communication platform BRN, large investors (wallets holding 10-10,000 BTC) have accumulated approximately 42,565 BTC since December 1. This strongly indicates that smart money is investing in the market. Historically, this behavior by large whales has signaled positions near market lows.

Conversely, short-term traders and retail investors continue to reduce their positions. The net selling activity from these groups suggests a polarization within the market. Institutional accumulation is being offset by retail selling. The coming weeks will reveal which group’s stance will dominate market direction.

Ethereum and Broader Market: A Stronger Downturn Again

While Bitcoin declined by 2.24% over the past 24 hours, Ethereum experienced a milder correction. ETH fell by 3.71%, reaching around $2,420. Broader market indices from CoinDesk reflected this weakness more clearly. The CoinDesk 20 (CD20) and CoinDesk 80 (CD80) indices recorded losses of 3.85% and higher within 24 hours. This indicates that altcoins outside the leading assets remain weaker, and the market’s risk appetite remains cautious.

Technical Outlook: What Is the Condition for Breaking Resistance?

Bitcoin’s daily chart analysis, in candlestick format, clearly depicts the fluctuations since September. The key point is: Bitcoin is within a broad downtrend, confined by an opposing trend ascending channel. This channel defines the limits of short-term stabilization.

For the market to shift from decline to rise, it must clearly break above this opposing trend channel’s upper boundary. Currently, levels are testing whether this breakout can occur. If resistance is overcome, bullish signals will strengthen. Otherwise, deeper levels may be tested.

Developments in the Crypto Ecosystem: Web3 and Governance Movements

Although the market’s pricing mechanism appears weak, fundamental structural developments continue within the crypto ecosystem. Ethereum’s creator Vitalik Buterin and the Fileverse project are collaborating. Fileverse is a decentralized, open-source, encrypted document platform similar to Google Docs. Buterin announced on X platform that the project has spent the last few months fixing bugs and is now ready for secure document sharing and collaboration.

On the governance front, Arbitrum DAO is progressing successfully through voting. DAOs aim to decentralize community participation via delegated governance mechanisms. Arbitrum’s one-year initiative was designed to reward delegates demonstrating consistent voting behavior.

External Markets and Macro Backdrop: Bond Yields Remain Resilient

Crypto markets are not independent of overall financial conditions. The US 10-year Treasury yield, after the Fed’s rate cut, rose slightly from its lowest point of 4.11% to 4.14%, still showing resistance at high levels. ING analysts stated that the likelihood of these yields rising sustainably is lower than the chance of them decreasing.

In stock markets, the DJIA and S&P 500 posted slight gains on Wednesday, increasing by 1.05% and 0.67%, respectively. However, the weak nature of these gains indicates that the market remains in a cautious mode. The DXY (dollar index) decreased by 0.2%. Safe-haven assets like gold and silver saw increased demand; gold futures rose by 0.47%, and silver advanced by 2.53%.

Summary: Questions the Market Needs to Answer

Bitcoin and the broader crypto ecosystem are currently awaiting a revival of buying pressure. The return of large ETF inflows of around $500 million will be a significant signal regarding market sentiment. The macro environment, especially Fed policy and bond yields, will continue to be the key factors shaping the fate of crypto assets. Meanwhile, the accumulation of nearly 42,000 BTC by large investors indicates that the market is showing interest at lower levels. In the coming period, the question of which force will dominate — the large investors or the retail and short-term players — will influence market direction.