Key takeaways:
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BTC failed to hold $70,000 despite powerful inflows into ETFs as selling by public miners offset recent institutional buying.
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Options markets reflect powerful demand for downside protection as the 17% premium signals cautious sentiment.
Bitcoin (BTC) failed to hold Monday’s $70,000 level despite a net inflow of $471 million into U.S.-listed spot ETFs. The initial market excitement subsided after reports of the destruction of numerous American and Israeli aircraft and equipment during the military operation in Iran that took place over the weekend.
As the S&P 500 remained relatively flat from Friday to Tuesday, Bitcoin’s inability to maintain its bullish momentum is likely due to other factors.
US-listed Bitcoin ETFs recorded net inflows of $471 million on Monday, the most in more than five weeks; however, the trend of the previous two weeks remained subdued, signaling a lack of conviction. Some of traders’ concerns stem from recent Bitcoin sales by publicly traded miners.
Bitcoin mining and digital asset treasure companies are putting pressure on BTC
According to Lookonchain, MARA Holdings (MARA US) transferred 250 BTC on Tuesday data. MARA previously announced the sale of 15,133 BTC in March and reported a total holding of 38,689 BTC. Traders fear additional selling pressure as many miners focus on reducing debt to fund a strategic shift toward AI computing data centers.
According to Arkham, Riot Platforms (RIOT US) put 1,500 BTC up for sale in the first week of April data. According to the company’s latest operational update, it held 15,680 BTC, increasing fears of further liquidations as high energy costs negatively impact operations.
Other addresses associated with vast miners sold 265 BTC on Tuesday after accumulating since the beginning of 2024, According to to Lookonchain. There are still 112 BTC at 3PFNdgGi…myCh139. Regardless of the reasons behind the moves, sentiment soured after Bitcoin’s hashrate fell to 953 exahashes on Monday, down from 1,083 exahashes in behind schedule February.
Strategy (MSTR US) continued to accumulate Bitcoin, reaching a total of 4,871 BTC in the previous week alone. However, investors are increasingly concerned that there will be few buyers left in the market after a two-month bear market, especially as companies that took out debt to accumulate Bitcoin are under intense pressure and are forced to sell some of their reserves.
Companies that have reduced their Bitcoin holdings over the past month include Sequans Communications (SQNS FR) and Nakamoto Inc (NAKA US). More worryingly, several other publicly traded companies are suffering losses of 35% or more on their Bitcoin holdings, including GD Culture Group (GDC US) and OranjeBTC (OBTC3 BR), according to BitcoinTreasuries data.
Related: A BTC analyst warns that the price of Bitcoin may “surpass $15,000” in the next 5 months.
Bitcoin options markets signaled discomfort on Tuesday as put (put) options traded at a 17% premium to call (call) instruments. Traders believe that whales read the market better, but options results are skewed because ordinary investors constantly buy downside protection rather than calculated moves from market makers.
There is no indication that professional investors are turning bearish, but a single day of powerful net ETF inflows does not prove increased institutional demand. Therefore, even if the deal to reopen the Strait of Hormuz raises risk markets, there is a risk that Bitcoin will struggle to sustain levels above $75,000 given risk aversion.
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