This prevailing Bitcoin cycle seems notably muted in comparison with previous bull runs. Despite trends of appreciation in Bitcoin’s price, the enthusiasm and retail participation typically associated with such a trend are noticeably absent.
CryptoQuant, a blockchain analytics firm, attributes this shift to a particular on-chain metric – the percentage of Bitcoin held for a duration of one to four weeks is significantly lower than in past cycles. This phenomenon could imply that the usual surge of new participants, which previously spurred rapid price rallies, is largely missing from the current scene.
Two contributing factors to this change have been identified by CryptoQuant in its recent analysis. Firstly, the macroeconomic setting has dramatically transformed. In stark contrast with the 2020-2021 cycle, driven by near-zero interest rates and aggressive monetary easing, the present market operates under conditions of tight liquidity and sustained high interest rates. As a result, capital is less readily available, making extensive, euphoric price movements more challenging to accomplish.
Secondly, the market’s leadership has transitioned from retail investors to institutions, a shift that became particularly apparent following the approval of Bitcoin Exchange-Traded Funds (ETFs). Institutional flows are typically more calculated and restrained, contributing to a structured, gradual uptrend rather than the unpredictable volatility characteristic of earlier cycles.
This evolution in the market’s structure has engendered a more cautious market atmosphere. Some analysts misconstrue this slower pace as an indication that the cycle has reached its peak, but CryptoQuant contends that such an assertion would be premature. Rather than following a traditional boom-and-bust pattern, this cycle could unfold as a longer, more intricate progression. ETF inflows remain stable, and if macro conditions were to ease, further potential for growth is plausible.
The firm asserts, “In times like this, what matters most isn’t chasing quick pumps – It’s understanding the slower structure and having the patience to stay with it.”
In its recent market update, QCP Capital reported that Bitcoin risk reversals remain skewed in favor of puts until June, indicating that traders maintain a mildly cautious stance in the near term. This position mirrors the broader market hesitation as Bitcoin continues to consolidate within the $80,000 to $90,000 range. Market participants are largely adopting a “wait and see” approach in response to the uncertainty surrounding the global tariff landscape.
However, QCP Capital also notes a shift in sentiment further along the curve. Over the weekend, the firm observed aggressive buying of 800 contracts of the BTC-27MAR26-100K call option. This suggests that while short-term caution persists, there is a growing appetite amongst institutions for long-term bullish positioning. This new development could indicate a shift from the current cautious stance to a more optimistic outlook for Bitcoin’s future.
