Bitcoin’s climb toward the $80,000 level may be on uncertain footing, as declining trading activity and a lack of strong conviction from large investors call the rally’s strength into question, according to 10x Research.
In a weekly report, Markus Thielen, the firm’s head of research, highlighted a disconnect between bitcoin’s recent price gains and overall market participation. While BTC has risen about 4.7% over the past week, underlying data suggests the move is not being supported by robust engagement.
Trading volumes have weakened, with bitcoin running 17% below its average and ether (ETH) down 20%. Funding rates, which reflect leveraged positioning, have dropped to the 3rd percentile, while total volumes have fallen to the 4th percentile. Thielen said this indicates the rally has been driven mainly by spot demand and short covering, rather than strong leveraged buying.
This distinction is significant. Spot-driven moves—often linked to institutional inflows—tend to be more stable but lack the intensity typically associated with sustained bull runs.
Institutional activity has nonetheless provided some support. Bitcoin ETFs have posted nine consecutive days of inflows, lifting April’s total to roughly $2.5 billion. At the same time, bitcoin dominance has climbed to 60%, signaling that capital is concentrating in BTC rather than spreading across the broader crypto market.
Even so, Thielen warned that the rally’s structure remains fragile. He described the current environment as a low-volume, low-funding regime, which historically points to market hesitation, with many participants staying on the sidelines.
Options markets appear to confirm this cautious outlook. Implied volatility has fallen into the lower end of its historical range, and traders are pricing in relatively modest near-term price swings, suggesting expectations for subdued market conditions despite elevated sentiment.
Ethereum reflects a similar trend, though with even weaker participation. Volumes have dropped by more than 50%, and derivatives positioning shows limited appetite for risk. Thielen said the sharp decline in activity underscores a broader lack of conviction among traders.
Despite these concerns, the setup is not outright bearish. With fewer leveraged long positions in place, the risk of cascading liquidations on the downside is reduced, leaving room for upside if a new catalyst emerges.
That catalyst, the report suggests, will likely come from macroeconomic developments. For now, bitcoin’s rally remains intact, but without stronger participation, its sustainability may depend on support from the broader macro environment.
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