Bitcoin Stalls As Institutional Demand Fades

While bitcoin seemed to be initiating a rebound at the beginning of this year, the momentum suddenly froze. Around 88,000 dollars, the asset struggles to convince, held back by a climate of political and monetary uncertainty. Institutional investors are easing off, cooled by tensions in Washington and the Fed’s wait-and-see attitude. While some indicators reveal a continued upward trend, signals from the derivatives markets tell another story : that of a market that doubts, observes, and waits.

Market Professionals Scale Back

The derivatives market provides clear indicators of a retreat in risk appetite among the most seasoned investors.

Despite a recent rebound of Bitcoin around 88,000 dollars, institutional operators do not seem inclined to support a continued upward trend. Data extracted from exchange platforms reveal a significant drop in the futures premium. Thus, the annualized premium on three-month Bitcoin futures has fallen to 9 %, down from 13 % a week earlier.

Several elements confirm this cautious climate :

• A decline in futures premium : the tightening premium suggests that market players no longer pay to secure long positions, reflecting a loss of confidence in a rapid price rise ;
• Stagnation of institutional positions on the CME : data from the Chicago exchange do not record a significant recovery of net long positions, showing a waiting attitude among professionals ;
• Overvalued put options : put options for levels below 80,000 dollars trade at a higher premium, signaling an anticipation of correction ;
• Unbalanced put/call ratio : the marked interest in put options translates a heightened willingness to hedge against potentially bearish volatility.

Technical signals converge towards the same reading: institutional investors opt for caution and prefer marginal positioning, in a climate where bullish catalysts are neither obvious nor immediate.

The Macroeconomic Environment Redirects Flows

Beyond internal crypto market dynamics, macroeconomic forces weigh on the trajectory of bitcoin. Among them, the prospect of a federal shutdown in the United States acts as a catalyst of uncertainty.

Concerns are growing about Congress’s ability to pass a budget law on time, and markets react by moving toward assets perceived as more stable. Indeed, this American institutional tension contributes to the current wait-and-see stance in the crypto market: the specter of a federal shutdown fuels a rotation towards safe-haven assets.

Moreover, the other point of tension comes from US monetary policy. Expectations of Federal Reserve decisions slow down risk-taking, in a context where any indication of tightening could increase selling pressure on volatile assets.

Thus, traders await clear signals from the Fed regarding interest rates, which delays positions on bitcoin. At the same time, gold has reached a historic high, capitalizing on this quest for security that benefits traditional financial instruments.

In a climate full of uncertainties, the bitcoin price reflects growing tensions between hopes of recovery and investor caution. Between Fed policy and the risk of a shutdown, market signals urge restraint.