Bitcoin’s retail market is experiencing a downturn, with the number of wallets holding non-zero balances falling to a five-month low of 52.45 million, as reported by Glassnode. This is a significant drop from over 52.56 million on Jan. 20, the day Bitcoin reached its all-time high of $109,000. Additionally, U.S. Bitcoin ETFs have seen substantial outflows, with a total of $494 million leaving over three consecutive days, culminating in a $251 million outflow on Feb. 12. These outflows reflect growing concerns in the market as institutional interest wanes.
Trading volumes in U.S.-listed Bitcoin ETFs have also dwindled, with just $2.58 billion in total volume on Feb. 12. Among these, BlackRock’s iShares Trust (IBIT) saw just under $2 billion in volume, putting it among the least traded ETFs. Fidelity’s Bitcoin fund (FBTC) recorded the largest individual outflow, with $102 million leaving the market. This suggests that Bitcoin ETFs, which are mainly used as trading vehicles, are not attracting the same level of interest as they once did.
However, while the retail sector and ETFs face challenges, Bitcoin’s large holders, also known as whales, are accumulating the digital asset. On Feb. 5, whales added 39,620 BTC, worth about $3.79 billion, when Bitcoin’s price dipped below $97,600. This accumulation is viewed as a positive sign by some analysts, such as Juan Pellicer from IntoTheBlock, who believes that the market may be nearing its bottom. This pattern mirrors past price corrections, suggesting that whales see value at current levels.
Despite the positive signs from whales, Bitcoin’s price has been relatively stagnant, hovering around $96,000 and trapped in a trading range between $90,000 and its all-time high. Analysts, including Iliya Kalchev from Nexo, indicate that Bitcoin’s potential for growth is limited unless it breaks decisively above the $100,000 threshold.
The broader economic context adds further complexity to Bitcoin’s outlook. Ongoing trade tensions between the U.S. and China, particularly the imposition of new tariffs, have left investors cautious. Upcoming talks between U.S. President Donald Trump and Chinese President Xi Jinping will likely influence market sentiment. These discussions could affect global trade and economic stability, indirectly influencing Bitcoin’s market movements.
While Bitcoin is currently facing challenges in both the retail and ETF sectors, whale accumulation suggests that the market may be stabilizing. However, the lack of significant upward movement in Bitcoin’s price, combined with geopolitical concerns, means that the digital asset’s future remains uncertain.
