Bitcoin has recently failed to break through the $80,000 barrier, hovering around the $79,000 mark. Although prices appear stable on the surface, the real support for BTC is currently coming from the derivatives market rather than spot trading. The low activity in spot transactions suggests that Bitcoin’s current levels are built on fragile ground.
Derivatives trading dominates market activity
According to the latest data, a striking 87.77% of Bitcoin trading volume on major exchanges comes from derivatives products. This heavy reliance on leverage increases the risk of sharp price swings if a sell-off occurs. Nominal volumes in the derivatives market have reached $9.73 billion, but genuine spot buying demand is almost missing, raising concerns about the sustainability of the current price levels.
Liquidity is heavily concentrated on Binance, which accounts for 87.22% of the derivatives trading share. Meanwhile, Deribit—another major crypto derivatives exchange—has not demonstrated the expected level of institutional hedging activity. Observations indicate that investors are shifting away from the spot market, relying on debt, leverage, and high hopes to maintain their positions in Bitcoin.
Julio Moreno, Head of Research at CryptoQuant, noted in his weekly report that “the wave from the derivatives market was the main driver of Bitcoin’s move toward $79,000, while real buying demand has declined.”
CryptoQuant’s “Bull Score” indicator dropped from 50 to 40 points in April, falling below neutral territory. The decrease in spot demand means that price increases lack a solid foundation. In this environment, even if prices rise, the underlying support does not inspire confidence among investors.
Key technical signals and rising volatility
From a technical perspective, Bitcoin’s daily chart registered a “Shooting Star” candlestick pattern. This usually signals that buyers briefly pushed up prices, only for sellers to drag them back down before the session ended. Bitcoin now sits on a former resistance level turned support, but this area has failed to provide a strong sense of security.
Daily trading volume climbed to 15,780 BTC—above the 20-day average of 13,870 BTC—yet selling pressure dominated. Short-term price momentum dropped by 3.5%, buy-side interest fell 28.6%, and overall trading activity is down 13.3%. These figures highlight a clear drop-off in both investor interest and market activity.
The options market is increasingly pricing in downward risks. The 25-delta skew rose by 6.75%, and open positions in options shrank by about 10%. Meanwhile, the volatility gap jumped 173.4%, indicating that perceived risk exceeds the risk actually being traded in the market.
ETF outflows and shift toward short-term investors
Recent figures from the US show that spot Bitcoin ETFs experienced net outflows of $783.4 million, with ETF trading volumes dropping 13.45%. This waning institutional interest raises the likelihood that the market may continue to move sideways or even test lower levels. On-chain data show daily active wallet addresses rose 6.4%, even as total daily transfer volume fell by 7.4%, suggesting more addresses are becoming active but large transactions have slowed.
By the end of April, the gap between long-term and short-term investors’ returns hit its lowest level, but long-term holders soon saw their profits increase again. Notably, 97.2% of Bitcoins sent to exchanges recently have originated from short-term investors. Holders with 1–1,000 BTC in their accounts comprised 58% of total inflows, while those with smaller balances followed with an 18.5% share.
On April 24, Bitcoin inflows to exchanges peaked at 35,649 BTC in a single day, but by May 3, this figure had plummeted to just 3,895 BTC. Short-term investors are currently realizing only a 2.17% average loss, a figure that continues to shrink. At the same time, long-term holders are enjoying profits of around 27%. While new buyers have returned to profitability and market sentiment has crept back into “optimism” after several weeks, the lack of real spot demand means Bitcoin’s position remains shaky.
