Bitcoin has attracted attention with its recent rise approaching 80 thousand dollars, but the low transaction volume and weak derivative transactions in the market have raised questions about the sustainability of this rise. In the weekly report of 10x Research Head of Research Markus Thielen, the disconnect between price movements and market participation was emphasized. “Bitcoin rose 4.7 percent last week, but the data points to a more cautious picture below the surface,” Thielen said.
Trading volume in the market dropped sharply
According to the data, Bitcoin’s weekly transaction volume fell 17 percent behind the average. On the Ethereum side, the decline is sharper; ETH’s trading volume decreased by 20 percent. During the same period, funding rates, which are seen as an indicator of leverage, also turned significantly negative. According to Thielen’s report, funding rates fell by 6.8 percent and fell to statistically lowest levels. Total transaction volume decreased by 33 percent, falling to the fourth percentile. It was noted that “the increase occurred mostly through spot purchases or the closing of short positions, while strong leveraged purchases were replaced by risk aversion.”
This distinction is important because spot purchases, although generally dominated by institutional demand and more stable, are not sufficient to give momentum to the market. Therefore, the decline in trading volume does not support the momentum seen in a typical bull market.
Institutional interest and ETF flows
The corporate side paints a positive picture. It was announced that Bitcoin-focused exchange-traded funds received inflows for nine consecutive days and total inflows in April reached 2.5 billion dollars. There is also an increase in market dominance; Bitcoin’s share in the total market increased to 60 percent. This indicates that capital is concentrated mostly in Bitcoin, with relatively low interest in other crypto assets.
Still, Thielen considers the current situation in the market to be fragile. The report stated that “Most of the participants moved away from active transactions and started to wait on the sidelines, and the low volume and funding environment reflected more indecision and cautious approach.”
Market expectations and potential catalysts
Derivative markets also support this view. While volatility in the options market has fallen to the bottom quarter of the historical range, investors are expecting more stable price action for the coming week. While it was stated in the report that “the market is pricing in a very calm environment”, it was noted that sentiment indicators were pushing high levels.
There is a similar – even slightly more stagnant – picture on the Ethereum front. It was highlighted that there was a decrease of more than 50 percent in ETH’s transaction volume and a weakening of the willingness to take risks in derivative positions. “This collapse in volumes shows that confidence remains low and participation is very limited,” Thielen commented.
Despite all these signals, there is no expectation of a severe decline in the market. The lack of density in leveraged long positions limits the risks of liquidation in a possible downward movement. Thielen noted that the rise could be strong if a positive catalyst emerges in the short term, but this depends on non-crypto macroeconomic developments.
“The market has evolved from a period of more active trading to an environment where the majority waits on the sidelines; low funding, low volume often reflects hesitation” came to the fore.
In summary, Bitcoin’s bullish momentum is still ongoing but market participation is weak. Experts think that external macroeconomic developments may determine the direction in the short term.
