Bitcoin Breaks Out as U.S. Eyes Gold-for-BTC Shift: Major Catalysts Ahead?

André Dragosch, PhD Director, Head of Research — Europe

Overview

Chart of the Week
Performance
Sentiment
Fund Flows
On-Chain
Futures, Options & Perpetuals
Bottom Line
Appendix

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Last week, crypto markets remained in consolidation mode, with Bitcoin trading sideways around $85K before breaking out to $87K over the weekend. Market anticipation is building ahead of key catalysts this week, including PCE inflation data, Q4 U.S. GDP, and the expiration of $11.67 billion in Bitcoin options.
Our in-house Cryptoasset Sentiment Index is starting to signal a slightly bullish outlook, as select indicators such as BTC exchange inflows and Crypto Hedge Fund Beta showed modest improvement.
Sovereign accumulation of hard assets is accelerating, with China increasing gold reserves and the U.S. exploring Bitcoin purchases via gold sales. The potential risk of gold overvaluation could trigger a capital shift toward Bitcoin as a sovereign reserve asset.

Chart of the Week

Modeling Gold Rotation into Bitcoin Across Major Sovereign Holders
Estimated Bitcoin Acquisitions and Share of Total BTC Supply if Top Gold-Holding Nations Reallocate 1%, 5%, or 10% of Reserves

Performance

Last week, the cryptoassets market mostly remained in consolidation mode, with Bitcoin trading sideways around $85K. However, over the weekend, Bitcoin rose to $87K, breaking out of its recent trading range. This price stability masks the heightened anticipation building ahead of several high-impact catalysts expected this week, including February's PCE inflation data, US Q4 GDP data, and the expiration of $11.67 bn in Bitcoin options on Friday - with a max pain point at $85K potentially anchoring short-term price action.

In a highly anticipated development, Bo Hines, Executive Director of the President's Council of Advisers on Digital Assets, revealed that the administration is looking into the sale of U.S. gold reserves to acquire Bitcoin in a budget-neutral strategy. This approach aligns with Senator Cynthia Lummis' Bitcoin Act of 2025, which proposes the U.S. accumulate 1 million bitcoin over five years - equivalent to approximately 5% of total supply. President Trump, in a pre-recorded address at the Blockworks Digital Assets Summit, reaffirmed his commitment to making the U.S. the "undisputed bitcoin superpower and the crypto capital of the world".

These statements come as China continues to expand its gold holdings, adding 160,000 ounces in February alone. China's gold reserves now stand at a record 73.6 million troy ounces, comprising 5.9% of its total FX reserves. The parallel accumulation of hard assets by global powers reflects a broader trend of sovereign diversification away from fiat reserves, further elevating Bitcoin's potential role in national balance sheets. With gold at record highs and sovereign accumulation accelerating, there is a growing risk that gold may become overvalued as a hard asset. Once investors perceive diminishing returns in gold, this could trigger a stronger capital shift toward Bitcoin (Chart-of-the-week).

Meanwhile, on the regulatory front, the SEC has dropped its appeal against Ripple Labs, signalling a shift under Acting Chair Mark Uyeda toward reducing enforcement pressure. However, Ripple continues to contest a $125 million fine related to institutional XRP sales. At the same time, the Department of Justice maintains a stricter stance, pursuing charges against Roman Storm, co-founder of Tornado Cash, for money laundering and sanctions violations. The case has reignited debate around developer liability in DeFi and the implications for open-source innovation.

The Office of the Comptroller of the Currency (OCC) also announced it will cease uating banks based on reputational risk tied to clients, a move expected to improve banking access for crypto firms, many of which have been historically excluded from traditional financial services.

This regulatory recalibration could significantly benefit the industry's infrastructure development over the coming quarters.

Despite the broader consolidation in prices, strategic capital deployment continues across the ecosystem. Coinbase is reportedly in advanced talks to acquire Deribit, a leading crypto derivatives exchange, while Kraken announced a $1.5 billion acquisition of NinjaTrader, further expanding its footprint in U.S. retail futures markets. MoonPay secured a $200 million credit line from Galaxy Digital, underscoring continued institutional support for crypto infrastructure development despite the recent downturn in venture funding.

As gold continues to establish new all-time highs, we expect the relative valuation gap between gold and Bitcoin to compress. Bitcoin's investment case is increasingly compelling on a relative basis- offering gold-like scarcity, yet with superior portability, divisibility, and around-the-clock liquidity. These attributes better align with the operational demands of modern capital markets. Portfolio diversification into Bitcoin alongside gold not only enhances risk-adjusted returns but also future-proof sovereign and institutional portfolios against monetary debasement and global capital realignment.

In general, among the top 10 crypto assets TRON, Chainlink and Toncoin were the relative outperformers.

Overall, altcoin outperformance vis-à-vis Bitcoin increased from last week, with 60% of our tracked altcoins managing to outperform Bitcoin on a weekly basis. Ethereum also outperformed Bitcoin last week.

Sentiment

Our in-house “Cryptoasset Sentiment Index” has started to signal a slightly bullish sentiment.

At the moment, 4 out of 15 indicators are above their short-term trend.

Crypto Hedge Fund Beta have improved from last week along with BTC Exchange Inflows, while other indicators remain relatively bearish.

The Crypto Fear & Greed Index currently signals a “Fear” level of sentiment as of this morning, improving slightly from last week.

Performance dispersion among cryptoassets has remained at very low levels, signalling that altcoins have continued to be highly correlated with the performance of Bitcoin lately.

Altcoin outperformance vis-à-vis Bitcoin has increased last week, with around 60% of our tracked altcoins managing to outperform Bitcoin on a weekly basis. Ethereum also managed to outperform Bitcoin last week.

In general, increasing (decreasing) altcoin outperformance tends to be a sign of increasing (decreasing) risk appetite within cryptoasset markets and the latest altcoin underperformance signals a bearish risk appetite at the moment.

Sentiment in traditional financial markets as measured by our in-house measure of Cross Asset Risk Appetite (CARA) continued to improve last week, moving from 0.23 to 0.31. The index signals a slightly bullish cross asset risk appetite.

Fund Flows

Weekly fund flows into global crypto ETPs have accelerated last week, flipping positive, signalling an improving sentiment.

Global crypto ETPs saw around +689.6 mn USD in weekly net inflows across all types of cryptoassets, after -1610.4 mn USD in net outflows the previous week.

GlobalBitcoinETPs have experienced net inflows totalling +736.5 mn USD last week, of which +744.3 mn USD in net inflows were related to US spot Bitcoin ETFs.

The Bitwise Bitcoin ETF (BITB) in the US experienced minor net outflows, totalling -3.0 mn USD last week.

In Europe, the Bitwise Physical Bitcoin ETP (BTCE) also experienced minor net outflows equivalent to -5.4 mn USD, while the Bitwise Core Bitcoin ETP (BTC1) managed to attract capital of around +0.4 mn USD.

Outflows from the Grayscale Bitcoin Trust (GBTC) continued last week, with around -24.5 mn USD in net outflows last week. The iShares Bitcoin Trust (IBIT), however, experienced net inflows of around +537.5 mn USD last week.

Meanwhile, flows into globalEthereumETPs remained negative but decelerated last week, with around - 74.3 mn USD in net outflows last week

US Ethereum spot ETFs even recorded net outflows of around -102.9 mn USD on aggregate. Nonetheless, the Grayscale Ethereum Trust (ETHE) experienced slight net inflows around +2.9 mn USD last week.

The Bitwise Ethereum ETF (ETHW) in the US had sticky AuM (+/- 0 mn USD) last week.

In Europe, the Bitwise Physical Ethereum ETP (ZETH) saw minor net inflows of +1.2 mn USD while the Bitwise Ethereum Staking ETP (ET32) saw minor net inflows of +0.1 mn USD

Altcoin ETPs ex Ethereum have become slightly positive last week, with around + 14.5 mn USD in global net inflows.

Furthermore, thematic & basket crypto ETPs experienced minor net inflows of around + 12.9 mn USD on aggregate last week. The Bitwise MSCI Digital Assets Select 20 ETP (DA20) had sticky AuM (+/- 0 mn USD).

Global crypto hedge funds have continued to increase their market exposure to Bitcoin. The 20-days rolling beta of global crypto hedge funds' performance to Bitcoin increased around 0.90 per yesterday's close, up from 0.83 the week before.

On-Chain Data

In general, Bitcoin's on-chain developments have improved slightly from last week.

Selling pressure has flipped from last week, with around -0.27 bn USD in net selling volumes on BTC spot exchanges.

In terms of Spot Cumulative Volume Delta (CVD), which measures the difference between buying and selling volume, the metric has been negative most of last week, indicating dominance of sell-side pressure. However, it is worth noting that supply dynamics on exchanges tend to provide a slightly clearer explanation of price action.

Whales have removed bitcoins from exchanges on a net basis, indicating a decrease in whale selling pressure. More specifically, BTC whales removed -91,067 BTC off exchanges last week, a slight deceleration from the -249,253 BTC from the week prior. Network entities that possess at least 1,000 Bitcoin are referred to as whales.

At the time of writing, only 2.66 million BTC remain on exchanges (13.4% of circulating supply), according to data provided by Glassnode, the lowest level since November 2018.

That being said, a measure of “apparent demand” for bitcoin over the past 30 days has continued its negative trend since February 2025 which is signalling that demand for bitcoins has been decelerating lately.

Futures, Options & Perpetuals

Last week, BTC futures open interest increased by around +2k BTC while perpetual open interest increased by around +2.2k BTC.

BTC perpetual funding rates turned slightly negative yesterday, signalling bearish sentiment among perpetual futures traders.

In general, when the funding rate is positive (negative), long (short) positions periodically pay short (long) positions, which is indicative of bullish (bearish) sentiment.

The BTC 3-months annualised basis dropped from around 6.4% p.a last week to around 5.2% p.a. averaged across various futures exchanges. BTC option open interest also decreased slightly by around -4k BTC. The put-call open interest ratio followed suit, dropping to 0.49.

The 1-month 25-delta skew for BTC fell early last week but continued to rise after Wednesday, indicating a modest increase in demand for put options and a less bullish market sentiment.

BTC option implied volatilities also fell last week, with 1-month realized volatility slightly decreasing by 5%.

At the time of writing, implied volatilities of 1-month ATM Bitcoin options are currently at around 46.62% p.a.

Bottom Line

Last week, crypto markets remained in consolidation mode, with Bitcoin trading sideways around $85K before breaking out to $87K over the weekend. Market anticipation is building ahead of key catalysts this week, including PCE inflation data, Q4 U.S. GDP, and the expiration of $11.67 billion in Bitcoin options.
Our in-house Cryptoasset Sentiment Index is starting to signal a slightly bullish outlook, as select indicators such as BTC exchange inflows and Crypto Hedge Fund Beta showed modest improvement.
Sovereign accumulation of hard assets is accelerating, with China increasing gold reserves and the U.S. exploring Bitcoin purchases via gold sales. The potential risk of gold overvaluation could trigger a capital shift toward Bitcoin as a sovereign reserve asset.

Appendix

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