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Bull Market Nears Exhaustion? On-Chain Data Shows Big Players Dominate as Retail Activity Fades
- The US Fed held rates steady as Powell awaits tariff impact data, whilst the Bank of England maintained 4.25% but signalled possible August cuts, and European nations including Switzerland cut to 0% with hints of negative rates.
- Bitcoin remains choppy at US$104,735, essentially flat from a week ago despite institutional interest, as long-term holders appear to be taking profits off the table.
- Glassnode analysts describe the current market as an “on-chain ghost town” where institutional off-chain trading dominates, with combined spot, futures and options volumes exceeding on-chain settlement by 7-16 times.
- Market analysts are divided on whether we’re approaching a bear market, with some calling this the “late phase of the cycle” while others argue we’re not even in a proper bull run.
Yesterday, the US Fed left interest rates unchanged as Chair Jerome Powell said more time was needed to assess the effects of tariffs.
The Bank of England held rates at 4.25% but signalled a possible August cut as the labour market softens. In Europe, Norway, Switzerland and Sweden all lowered rates, with the Swiss National Bank cutting to 0% and hinting at possible negative rates if needed.
Additionally, markets are still on edge over developing events on the world stage.
Yet, crypto continues its choppy sideways action. Bitcoin (BTC) is currently trading at US$104,735 (AU$161,692) – ending up pretty much where it was a week ago (apart from a spike earlier in the week).
Read more: OKX and Consensys Join Forces to Elevate Onchain Trading and User Safety
Despite Institutional Interest, Transactions Dropped
As reported, some analysts believe that the lacklustre price action – despite enormous institutional interest – is due to long-term HODLers who are selling and taking profits off the table.
Meanwhile, Glassnode analysts called the current market an “on-chain ghost town”.
They wrote in a recent report that Bitcoin trading is increasingly dominated by institutional, highly-leveraged, off-chain participants, rather than retail on-chain activity.
Activity has increasingly migrated to off-chain venues, with centralized exchanges now commanding the majority of trading volume, with futures markets in particular leading this shift.
Glassnode The analysts added that “combined spot, futures, and options volumes routinely surpass on-chain settlement by 7–16x”.
Bear Market Incoming?
So, with all that, are we slowly heading towards the exit, with the bears poised to take over? Swissblock analysts seem to believe so, saying on Crypto Twitter that “we’re in the late phase of the cycle” and that liquidity is “thinning”.
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Seasoned crypto analyst Willy Woo agrees:
The countdown timer has started. We’re in the later innings of this bull market, but that doesn’t mean the move is over.
Willy Woo Others believe that we’re not even in a real bull market. Developer and commentator Krissdev said that people don’t have enough cash at present to invest in altcoins, and that if the opportunity arises, they would rather take profits – “always ready to sell to recoup capital” – than invest further.
Remember that during the last bull run, many missed their chance to sell their positions, ambushed by the market crash and the events surrounding Do Kwon and SBF – and are now likely sitting on altcoins they’re eager to offload.
Read also: China Fires Shot at Dollar: Digital Yuan Expansion Begins
Author
Aaron Feuerstein
Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.
