This report is for professional investors and information purposes only. Persons without professional investment experience should not rely on it. Not investment advice or a personal recommendation. Cryptoassets are high risk and volatile and you may lose all capital invested. See full risk information at the end of this document.
- Performance: Cryptoassets have extended their recovery, with bitcoin moving above $80k amid elevated short liquidations and continued short-covering. The $80k–$81k range stands out as an important zone, given the concentration of investor cost bases in that area. As always, cryptoasset prices remain volatile and can move sharply in either direction.
- Cryptoasset Sentiment Index: The Cryptoasset Sentiment Index has strengthened further, pointing to increasingly positive market sentiment. This supports a more constructive backdrop for prices, even as institutional demand has eased slightly.
- Chart-of-the-Week: Persistently negative perpetual funding rates through April point to crowded short positioning. This has helped drive the recent rally via short squeezes and could continue to influence price action near term, although positioning can shift quickly.
Chart of the Week
Performance
Cryptoassets have continued to rally on the back of improving sentiment and increasing short liquidations.
Bitcoin crossed the $80k mark in early Monday morning trading – the highest level since late January 2026. The ongoing recovery is being supported by a spike in short futures liquidations that reached $42M over a 24-hour period based on our calculations based on Glassnode data. Futures liquidations tend to support price recoveries as an increasing number of short investors cover their positions by buying back the underlying asset spot – a process usually described as ‘short squeeze'.
In fact, bitcoin traders have exhibited a short bias for most of last month judging by the perpetual funding rate. More specifically, the perpetual funding rate has been negative on 21 out of 30 days in April signalling excessive short positioning (Chart-of-the-Week). In general, perpetual funding rates tend to be a contrarian indicator as they tend to signal one-sided positioning that is indicative of either seller exhaustion or buyer fatigue.
Among institutional investors, leveraged funds tend to exhibit the highest short bias among all reportable positions according to the latest commitment-of-traders data for the CME Bitcoin Futures. Their latest reported net positioning is -10,474 contracts across both CME futures and options. It is worth mentioning though that leveraged funds mostly tend to engage in delta-neutral basis trades but even these could be partially unwound due to increasing basis risks as the gap between futures prices and spot prices widens in a bull market and the basis rate tends to increase. A partial unwinding of these positions may continue to fuel the current recovery in the short term as well.
That being said, the $80k price mark remains critical as it is possibly the ‘demarcation line' between bull and bear market. As highlighted in our latest Bitcoin Macro Investor report published last Friday, there is a significant confluence of important cost bases around the $80k-$81k price level.
The True Market Mean, short-term holder cost basis and the US spot bitcoin ETF cost basis cluster around this level. A decisive break above this level implies that the average investor crosses the break-even point which may change investor psychology in a positive way and may lead to a more sustainable recovery in prices. Thus, we still believe that this is an important price mark to watch.
However, institutional demand has somewhat cooled off again – Michael Saylor has recently indicated that Strategy (MSTR) has not conducted any bitcoin purchases last week. Nonetheless, it is worth mentioning that bitcoin historically tends to react positively to low purchase announcements as demonstrated here.
On the macro side, the European Central Bank kept rates unchanged at 2.15%, but flagged rising inflation risks and weakening growth, mainly driven by energy shocks. ECB policy is on hold for now, but the tone turned more hawkish, with a June rate hike clearly on the table if inflation persists. In addition, the Fed also held rates steady while emphasizing it needs “greater confidence” that inflation is moving toward target - so cuts are delayed, not cancelled, and policy remains cautiously restrictive.
Meanwhile, as nominal rates remain unchanged and inflation rates continue to rise, the decline in real rates may support a further recovery in cryptoassets as a decline in real rates usually signals an easing in monetary policy conditions. A potential tightening monetary policy down the road remains a risk for crypto markets.
In general, among the top 10 crypto assets Dogecoin, TRON, and Bitcoin were the relative outperformers. Ethereum underperformed bitcoin last week.
Sentiment
Our in-house “Cryptoasset Sentiment Index” has improved further and continues to signal a bullish investor sentiment, reinforcing the constructive market backdrop and supporting the recent price recovery.
At the moment, 11 out of 15 indicators are above their short-term trend.
Last week, the perpetual funding rate flipped from negative to positive and futures liquidations dominance also turned positive indicating a dominance of short liquidations.
The Crypto Fear & Greed Index declined throughout last week but has recovered slightly over the weekend again. It is currently signalling a “Fear” level of sentiment.
Performance dispersion among cryptoassets remained elevated last week.
When dispersion increases, it may indicate that the market appears to be driven by a more diverse set of narratives which, in our analysis, has historically been associated with periods of increasing risk appetite in prior market cycles.
Altcoin outperformance vis-à-vis Bitcoin decreased 15%-points last week, with only 20% of our tracked altcoins in the index outperforming. Ethereum also underperformed Bitcoin.
Sentiment in traditional financial markets as measured by our in-house measure of Cross Asset Risk Appetite (CARA) continued to increase to 0.78 over the past week, signalling improving risk appetite in traditional financial markets.
CME Bitcoin Commercials Net Positioning, which shows the difference between long and short CME Bitcoin futures contracts increased further from -8.8% to –10.5% of open interest suggesting the concentration of short positioning increased week-over-week, despite Bitcoin's outperformance.
It is worth mentioning that short positioning remains historically elevated and arguably crowded, which could lead to increased volatility if the negative net positioning were to reverse.
Fund Flows
Global crypto ETPs saw a significant deceleration in aggregate net inflows last week as Ethereum ETPs experienced net outflows.
Global crypto ETPs saw around +33.4 mn USD in weekly net inflows across most types of cryptoassets, after +1024.7 mn USD in net inflows the previous week.
Global Bitcoin ETPs continued to experience net inflows of +166.5 mn USD last week, of which +138.6 mn USD in net inflows were related to US spot Bitcoin ETFs.
The Bitwise Bitcoin ETF (BITB) in the US experienced net inflows, totalling +1.9 mn USD last week.
In Europe, the Bitwise Physical Bitcoin ETP (BTCE) experienced net inflows equivalent to +3.1 mn USD, as the Bitwise Core Bitcoin ETP (BTC1) experienced net inflows of +4.2 mn USD.
The Grayscale Bitcoin Trust (GBTC) posted net outflows of –73.7 mn USD and the iShares Bitcoin Trust (IBIT) experienced net inflows of around +136.5 mn USD last week.
Meanwhile, global Ethereum ETPs experienced -142.5 mn USD in net outflows last week, of which US spot Ethereum ETFs recorded net outflows of around -127.0 mn USD on aggregate.
Both the Grayscale Ethereum Trust (ETHE) and the iShares Ethereum Trust (ETHA) posted net outflows of -9.1 mn USD -71.4 mn USD, respectively.
The Bitwise Ethereum ETF (ETHW) in the US experienced net outflows of –2.2 mn USD.
In Europe, the Bitwise Physical Ethereum ETP (ZETH) recorded no net flows last week, as the Bitwise Ethereum Staking ETP (ET32) saw -0.4 mn USD of net outflows.
Altcoin ETPs ex Ethereum experienced net inflows of +6.7 mn USD last week.
Thematic & basket crypto ETPs posted small net inflows of +2.7 mn USD on aggregate last week. The Bitwise MSCI Digital Assets Select 20 ETP (DA20) experienced net inflows of +0.3 mn USD.
On-Chain Data
On-chain conditions for Bitcoin continued to improve meaningfully over the past week, pointing toward a gradual but increasingly coherent recovery in market structure.
Intraday spot volume delta rose further to +448 million USD, marking the strongest reading since mid-March 2026. This suggests a notable resurgence in aggressive buying pressure, particularly on shorter timeframes, and indicates that marginal demand is once again outweighing supply at the order book level.
At the same time, total exchange flows - measured as the sum of inflows and outflows - continued to decline. This contraction signals reduced transactional activity on centralized venues and typically reflects a cooling in speculative behaviour. In the current context, however, it aligns with a more constructive interpretation: a transition away from reactive trading toward stronger hands holding supply off-exchange.
Profitability metrics reinforce this shift. The total value held at a loss has steadily declined to 62%, indicating that a growing share of the network is returning to profitability. This trend is mirrored in Net Realized Profit/Loss, which has now flipped back into positive territory for the first time since late January 2026. Historically, such inflections tend to coincide with improving investor psychology and can act as a reflexive tailwind for price, as reduced loss pressure diminishes forced selling.
A particularly notable technical and on-chain confluence has emerged in the $80k–$81k range. This zone encapsulates the True Market Mean, the short-term holder cost basis, and the aggregate cost basis of US spot Bitcoin ETFs. The clustering of these key reference levels creates a critical pivot point: a decisive break and hold above this range would likely signal a transition into a more sustainable phase of the bull market recovery.
Meanwhile, the sell-side risk ratio continues to trend lower and is now at its lowest level since October 2023. This indicates that the incentive to realize profits or losses remains subdued, reflecting a broader equilibrium where investors are increasingly comfortable holding rather than distributing coins.
Finally, Long-Term Holder behaviour remains a clear source of structural support. Net position change over the past month stands at approximately +125k BTC, underscoring persistent accumulation by this cohort. This ongoing supply absorption continues to act as a strong tailwind, tightening available liquidity and reinforcing the constructive medium-term outlook.
Futures, Options & Perpetuals
Derivatives positioning for Bitcoin has shifted notably over the past week, reinforcing the improving tone already observed in on-chain data, albeit within a still fragile and reflexive market structure.
Perpetual funding rates have turned positive after remaining in negative territory for the majority of April - a period characterized by a pronounced short bias among leveraged participants. This reversal suggests that positioning has begun to normalize, with longs regaining marginal control. Importantly, such inflections often mark the early stages of directional re-pricing, particularly when they coincide with strengthening spot demand.
This dynamic was further underscored by a sharp spike in short liquidations, which reached approximately $42 million over a 24-hour window. The resulting short squeeze provided the mechanical fuel for Bitcoin's move back above the $80k threshold, illustrating the extent to which crowded positioning had previously suppressed price action. As is often the case, forced buying from liquidations acted as an accelerant rather than a root cause.
In terms of positioning, futures open interest increased by roughly +40k BTC equivalent, indicating a re-engagement of leverage on directional bets. In contrast, options open interest declined by approximately -23k BTC equivalent, largely attributable to month-end expiries rather than an outright reduction in hedging demand. The divergence between futures and options positioning suggests a market leaning more heavily toward short-term tactical exposure rather than structured risk management.
Options market internals further highlight a modest shift toward bullish sentiment. The put-call open interest ratio declined into expiry, reflecting relatively stronger demand for calls over puts. Consistently, the 1-month 25-delta skew also compressed in Favor of calls, indicating that upside convexity is being priced more aggressively than downside protection. While not extreme, this repositioning signals a gradual rebuilding of constructive expectations.
However, the broader volatility regime remains intact. Total gamma exposure has declined further and remains firmly negative at around -$1.7 billion. This implies that dealers are structurally short gamma, a configuration that typically amplifies price movements in either direction. In such an environment, market makers are forced to trade pro-cyclically - buying into strength and selling into weakness - thereby exacerbating volatility.
Taken together, derivatives markets are transitioning from a defensively positioned, short-biased regime toward a more balanced - yet still leverage-sensitive - setup. While sentiment has improved at the margin, the persistence of negative gamma suggests that price action is likely to remain reactive and prone to sharp, liquidity-driven moves in the near term.
Bottom Line
- Performance: Cryptoassets have extended their recovery, with bitcoin moving above $80k amid elevated short liquidations and continued short-covering. The $80k–$81k range stands out as an important zone, given the concentration of investor cost bases in that area. As always, cryptoasset prices remain volatile and can move sharply in either direction.
- Cryptoasset Sentiment Index: The Cryptoasset Sentiment Index has strengthened further, pointing to increasingly positive market sentiment. This supports a more constructive backdrop for prices, even as institutional demand has eased slightly.
- Chart-of-the-Week: Persistently negative perpetual funding rates through April point to crowded short positioning. This has helped drive the recent rally via short squeezes and could continue to influence price action near term, although positioning can shift quickly.
Appendix
Data subject to change
Combined positioning = futures and options in % of Ol
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