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: Bitcoin closed the week firmly lower (≈ -4%), retreating from roughly $77k to around $73.8k and slipping back below Strategy's ≈ $75.7k average acquisition cost, weighed down by a firmer-than-expected core PCE print and continued US spot Bitcoin ETF outflows.
- Cryptoasset Sentiment Index: Our in-house Cryptoasset Sentiment Index remained mostly unchanged throughout the week, with only brief dips into bearish territory, and is signalling a neutral to slightly bullish sentiment again as of this morning.
- Chart-of-the-Week: Marginal institutional demand has cooled, with the dominant marginal buyer, Strategy, hamstrung by rising sovereign bond yields that have pushed its variable-rate preferred (STRC) below par to roughly $97, impairing its primary capital-raising vehicle and prompting a pause in Bitcoin accumulation; combined with multi-week spot ETF outflows, this points to a materially thinner marginal bid for Bitcoin in the near term.
Chart of the Week
Net Institutional Demand shown as 1-month change
Net Institutional Demand - Global ETPs + Treasury Companies - New Supply
Performance
Bitcoin closed the week firmly lower, retreating from roughly $77k to around $73.8k (≈ -4%), and once again slipping below Strategy's ≈ USD 75.7k average acquisition cost. The leg lower was accelerated by a firmer-than-expected core PCE print on Friday and continued net outflows from US spot Bitcoin ETFs. On a relative basis, BTC was the clear laggard across the major asset classes, reaffirming its sensitivity to a “higher-for-longer” rate regime rather than its store-of-value narrative.
In contrast, traditional risk assets proved far more resilient. US equities held near record highs (S&P 500 ≈ 7,580), extending one of their longest weekly winning streaks since 2023, while gold stayed firm in the USD 4,500–4,600 area. Sovereign bonds, by contrast, sold off further - the 30Y UST yield pushed above 5% (a roughly two-decade high) and the 10Y bond hovered near 4.45% while the US Dollar held its ground around the 100 mark (DXY). Commodities remained elevated, with Brent crude in the low $90s amid the ongoing Middle East conflict.
Within digital assets, the standout exception was Hyperliquid (HYPE), which bucked the broad crypto weakness to print fresh all-time highs near $70, sharply outperforming Bitcoin on idiosyncratic adoption and revenue momentum. If you would like to learn more about Hyperliquid, you can read our latest deep dive here.
The soft monthly close is also broadly consistent with Bitcoin's well-documented “Sell in May and go away” seasonality, with the May–October window having historically delivered the weakest average returns of the calendar year.
Sentiment was further weighed by speculation around Strategy. On the 29th of May, on-chain trackers flagged a transfer of ≈ 411 BTC (≈ $30M) to Coinbase Prime - reportedly its first direct exchange transfer in almost two years - reviving rumours of potential Bitcoin disposals after Michael Saylor recently conceded a sale was “not unlikely” before year-end. Prediction markets now price the probability of a 2026 sale at above 90%. Some analysts think that a short-term sale is quite likely due to the utilization of tax loss harvesting which would be profitable for MSTR.
More fundamentally, marginal institutional demand has cooled as highlighted in our chart-of-the-week. In particular, the dominant marginal buyer, Strategy, has been hamstrung by rising sovereign bond yields, which have pushed its variable-rate preferred (STRC) significantly below par - slipping to roughly $97 - thereby impairing its principal capital-raising vehicle and prompting a pause in Bitcoin accumulation. Combined with multi-week spot ETF net outflows, this points to a materially thinner marginal bid for Bitcoin.
As far as macro developments are concerned, two major events dominated the calendar last week: (i) the Fed's preferred inflation gauge, core PCE, which printed on the firm side and reinforced the higher-for-longer narrative; and (ii) the escalating Middle East / Iran conflict, which kept Brent crude elevated and fuelled the long-end bond sell-off.
Looking ahead, the focus shifts to two key catalysts: the ECB rate decision and press conference on Thursday, and the US nonfarm payrolls report on Friday this week, which together should set the near-term direction for rates, the dollar and risk appetite.
In general, among the top 10 crypto assets Hyperliquid, BNB, and LEO were the relative outperformers. Ethereum performed more or less in line with bitcoin last week.
Sentiment
Our in-house “Cryptoasset Sentiment Index” remained mostly unchanged throughout the week with only brief dips into negative / bearish sentiment last week. As of this morning, the index is signalling a neutral to slightly bullish sentiment again.
At the moment, 12 out of 15 indicators are above their short-term trend.
Last week, there were bullish reversals in both the bitcoin futures basis rate and the put-call options volume ratio whilst the futures liquidations dominance reversed to the downside, i.e. signalling a higher dominance of long futures liquidations relative to short futures liquidations.
The Crypto Fear & Greed Index remained mostly unchanged last week. As of this morning, it is signalling a “fear” level of sentiment.
Performance dispersion slightly increased last week. The broader crypto sectors underperformed, DeFi, AI, and meme coins were able to outperform both BTC and ETH.
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 rising risk appetite in prior market cycles.
Altcoin outperformance vis-à-vis Bitcoin remained elevated with 70% of our tracked altcoins in the index outperforming. Ethereum performed at par with Bitcoin.
Sentiment in traditional financial markets as measured by our in-house measure of Cross Asset Risk Appetite (CARA) increased significantly to 0.82 over the past week, signalling that risk appetite is increasing in traditional markets.
CME Bitcoin Commercials Net Positioning, which shows the difference between long and short CME Bitcoin futures contracts decreased again to around –10.8% of open interest, indicating a very bearish outlook on near-term price direction. All in all, our Cryptoasset Sentiment Index held steady at neutral-to-slightly-bullish, with 12 of 15 indicators above trend and altcoins outperforming, while traditional-market risk appetite (CARA) rose to 0.82 even as CME Commercials' net positioning slipped to around –10.8% of open interest.
Fund Flows
Net outflows from global crypto ETPs reaccelerated last week with around -1,744.9 mn USD across all types of cryptoassets, after -833.8 mn USD in net outflows the previous week.
Global Bitcoin ETPs continued to experience net outflows of -1,491.1 mn USD last week, of which -1,420.4 mn USD in net outflows were related to US spot Bitcoin ETFs.
The Bitwise Bitcoin ETF (BITB) in the US experienced net outflows of -46.3 mn USD last week.
In Europe, the Bitwise Physical Bitcoin ETP (BTCE) experienced net outflows equivalent to -4.1 mn USD, as the Bitwise Core Bitcoin ETP (BTC1) also experienced net outflows of around -0.9 mn USD.
The Grayscale Bitcoin Trust (GBTC) posted net outflows of -175.1 mn USD whereas, the iShares Bitcoin Trust (IBIT) experienced net outflows of around -966.4 mn USD last week.
Meanwhile, global Ethereum ETPs experienced -263.9 mn USD in net outflows last week, of which US spot Ethereum ETFs recorded net outflows of around -253.9 mn USD on aggregate.
The Grayscale Ethereum Trust (ETHE) posted net outflows of -29.2 mn USD, whilst the iShares Ethereum Trust (ETHA) saw net outflows of -188.1 mn USD.
The Bitwise Ethereum ETF (ETHW) in the US experienced net inflows of +1.4 mn USD last week.
In Europe, the Bitwise Physical Ethereum ETP (ZETH) recorded minor net outflows of -0.8 mn USD, whilst the Bitwise Ethereum Staking ETP (ET32) saw net outflows of -0.3 mn USD.
Altcoin ETPs ex Ethereum bucked the overall trend and experienced net inflows of +29.0 mn USD last week mostly related to significant inflows into HYPE-related ETPs.
Thematic & basket crypto ETPs posted net outflows of -18.9 mn USD on aggregate last week. The Bitwise MSCI Digital Assets Select 20 ETP (DA20) experienced minor net inflows of +0.4 mn USD.
To sum up, Net outflows from global crypto ETPs reaccelerated to around -1,744.9 mn USD last week, led by Bitcoin ETPs (-1,491.1 mn USD) and Ethereum ETPs (-263.9 mn USD), while altcoin ETPs ex Ethereum bucked the trend with +29.0 mn USD in net inflows, mostly tied to HYPE-related products.
On-Chain Data
Bitcoin continued its descent across the week, with price reaching a low of $72.5k. Since the February 6th capitulation, Bitcoin has remained range-bound between $60k and $83k, placing the technical midpoint of this range near $71.5k. Price now sits just above this level, highlighting it as an important reference point.
By contrast, the Short-Term Holder cost basis (STH-CB) at $78.1k and the True Market Mean (TMM) at $78.3k represent an on-chain cost-basis cluster rather than a simple range midpoint. These levels capture the average acquisition prices of newer and active investors, respectively, and therefore provide a direct read on investor positioning and profitability. Price now remains well below this cluster, which has historically acted as a key threshold that must be reclaimed and held for momentum to re-establish.
Across the downtrend, loss-taking has experienced a slight uptick over the past two weeks, rising to $3bn as some investors capitulate under drawdown pressure. However, this remains muted by historical standards, with the November 2025 and February 5th capitulations reaching $9.4bn and $15.9bn, respectively.
This suggests two things. First, investors remain broadly resilient. Second, investor reaction functions appear somewhat saturated within the current range with price weakness no longer triggering a proportionate increase in loss taking.
This supports our broader thesis from recent months that liquidity remains acutely constrained within the prevailing trading range. To unlock latent supply, price may need to move meaningfully, either higher or lower, to incentivise further investor distribution.
Increasing our granularity into who is distributing, the majority of on-chain selling pressure over the past month has originated from investors who acquired coins between $77k and $78k. By contrast, the largest share of profit-taking, albeit still modest, has come from coins acquired in the $63k–$72k range. The close proximity of these clusters to the spot price suggests that distribution remains highly localised, with little evidence of capitulation from deeply underwater investors who remain largely unfazed by the drawdown.
Evidence of this is clear across the Long-Term Holder cohort, representing mature investors who have held their coins for more than 155 days. Paper losses held by this cohort have reached $141.3bn, with only 1.4% of trading days recording a larger USD-denominated loss. Despite this, these investors remain largely inactive, with LTH supply now reaching an all-time high of 14.9mn BTC. This suggests that maturation and accumulation pressures continue to outweigh spending across the cohort.
On balance, this contributes to a tightening of the supply side, as coins continue to mature into the LTH cohort, whose investors are statistically more price-insensitive than the average holder. This creates a more fragile market structure, where demand shocks can have an outsized impact in either direction.
Strategy's STRC continues to trade below par, declining further to $98.9 versus its $100 stated amount. When the instrument trades below par, additional issuance becomes less efficient, placing pressure on the company's near-term accumulation strategy. This has been compounded by recent concerns around a transfer to Coinbase Prime, which some market participants interpreted as potential selling activity, although these fears have since been largely dismissed.
In general, the Digital Asset Treasury complex remains under pressure, with companies holding a combined total of approximately –$9.3bn in unrealised losses at present.
On balance, the altcoin sector remains closely tethered to Bitcoin, with correlation and beta percentiles across the altcoin complex (180-day) remaining extremely elevated at 97% and 99%, respectively. This indicates a predominantly single-factor environment strongly anchored to Bitcoin, where altcoin moves remain highly reflexive and amplified relative to BTC.
Taken together, the market remains fragile and complex. From the perspective of investor positioning, price remains below the key on-chain cost-basis cluster, while investor disengagement continues to rise and liquidity remains thin. These conditions have historically been conducive to increases in volatility, with the next directional move likely to be important for determining market momentum.
Futures, Options & Perpetuals
Over the past week, BTC perpetual futures open interest increased by approximately +19.78k BTC, while CME futures open interest dropped sharply by around -24.6k BTC versus the prior week. That combination suggests leverage rebuilt across offshore perpetuals, while more institutionally oriented venues saw a meaningful reduction in positioning. Aggregate futures liquidations declined from the prior week. In total, liquidations reached roughly $2.30bn over the week, versus $2.90bn previously, with long liquidations of $1.68bn and short liquidations of $0.61bn.
Markets diverged this week, as equities continued to look through Middle East risks while Bitcoin traded more defensively. BTC reached the bull market support band, defined by the 20-week SMA and 21-week EMA, but failed to break through and subsequently reversed lower. Liquidity is now forming around $72k to $73k on the downside and around $75k on the upside, leaving the market in a tighter range with nearby support and resistance levels clearly defined.
Perpetual funding rates, measured on a 7-day moving average, ended the week higher at around +7.1% annualised. That suggests futures positioning became more constructive despite weaker spot price action, with long exposure continuing to rebuild across perpetual markets.
At the same time, the BTC 3-month annualised basis ticked up to around +2.4%. That leaves the futures curve still relatively flat, but slightly firmer than last week, reinforcing the view that positioning has improved at the margin without yet signalling a strong bullish impulse over the next few months.
In options markets, BTC Deribit options open interest decreased by roughly -47.8k BTC, bringing total open interest down to 358.8k BTC. The Deribit put to call open interest ratio declined slightly to 0.63, while the equivalent metric across IBIT options moved higher to 0.72 by week's end.
Taken together, these moves suggest options exposure was reduced on Deribit. The decline in Deribit open interest and lower put to call ratio point to reduced crypto native options activity and less relative demand for downside protection. By contrast, the increase in the IBIT put to call ratio suggests ETF linked options positioning became slightly more defensive.
The 25-delta skew was mixed across the term structure during the week. That suggests options markets did not show a clear directional shift in downside protection demand, even as spot remained sensitive to geopolitical headlines and continued to trade around key support levels.
Total GEX, on a 7-day moving average basis, decreased from -$1.22bn to -$3.97bn. This suggests dealer positioning has become more negative and more meaningful again, increasing the potential for hedging flows to amplify moves around nearby strike levels.
Dealer gamma exposure also remains concentrated around important nearby levels, with the bulk of negative gamma clustered around the $70k strike and some additional exposure around $72k. That leaves the market most sensitive to a renewed move lower towards those levels, particularly if spot loses the $72k to $73k liquidity pocket. By contrast, positive gamma has moved higher to the $74k to $75k area, suggesting stabilising dealer flows may sit closer to upside resistance and could help dampen moves if the market pushes back towards that range.
Bottom Line
- Performance: Bitcoin closed the week firmly lower (≈ -4%), retreating from roughly $77k to around $73.8k and slipping back below Strategy's ≈ $75.7k average acquisition cost, weighed down by a firmer-than-expected core PCE print and continued US spot Bitcoin ETF outflows.
- Cryptoasset Sentiment Index: Our in-house Cryptoasset Sentiment Index remained mostly unchanged throughout the week, with only brief dips into bearish territory, and is signalling a neutral to slightly bullish sentiment again as of this morning.
- Chart-of-the-Week: Marginal institutional demand has cooled, with the dominant marginal buyer, Strategy, hamstrung by rising sovereign bond yields that have pushed its variable-rate preferred (STRC) below par to roughly $97, impairing its primary capital-raising vehicle and prompting a pause in Bitcoin accumulation; combined with multi-week spot ETF outflows, this points to a materially thinner marginal bid for Bitcoin in the near term.
Appendix
Data subject to change
Combined positioning = futures and options in % of Ol
Important Information
This material is intended solely for professional investors and is not suitable for retail distribution and reliance.
The information provided in this material is for illustrative, educational or information purposes only and does not constitute investment advice, a recommendation or solicitation of an offer to buy any product or to make any investment.
This document (which may be subject to change and may be in the form of a presentation, press release, social media post, blog post, broadcast communication or similar instrument – we refer to this category of communications generally as a “document” for purposes of this disclaimer) is issued by Bitwise Europe GmbH (“BEU” or “the Issuer”). This document has been prepared in accordance with applicable laws and regulations (including those relating to financial promotions).
Bitwise Europe GmbH, incorporated under the laws of Germany, is the issuer of Exchange Traded Products (“ETPs”) described in this document under a base prospectus and final terms, which may be supplemented from time to time, and which are approved by BaFin. If you are considering investing in products issued by BEU you should check with independent financial adviser, your broker or bank that such products are available in your jurisdiction and suitable for your investment profile. A decision to invest any amount in an ETPs offered by BEU should take into consideration your specific circumstances after seeking independent investment, tax and legal advice.
Capital at risk. Cryptoassets are high-risk and volatile. The value of investments in cryptoassets and crypto-linked ETPs may fall as well as rise, and investors may lose some or all of their invested capital. No investor protection or compensation scheme applies. Past performance is not a reliable indicator of future results. Forward-looking statements are not guarantees.
You should read the relevant base prospectus and final terms before investing and, in particular, the section entitled ‘Risk Factors' for further details of risks associated with an investment. The prospectuses, final terms and other documents relevant to BEU's ETPs are available under the “Resources” section at www.bitwiseinvestments.com. When visiting this website, you will need to self-certify as to your jurisdiction and investor type in order to access these documents, and in so doing you may be subject to other disclaimers and important information.
Important Analytical Limitations: The observations and analyses presented in this document are based on historical market patterns and data correlations which may not repeat or continue in future market conditions. Past correlations between capital flows and performance metrics are not indicative of future performance and should not be extrapolated as predictive indicators. Material downside risks remain present across all investment timeframes regardless of current undervaluation metrics or favorable technical indicators. All model outputs, fair value calculations, and quantitative assessments are subject to significant uncertainty and methodological limitations, and should not be relied upon as the sole basis for making investment decisions. Investors should conduct independent due diligence and consider multiple factors beyond the scope of this analysis.
Read the full disclaimer here: https://bitwiseinvestments.eu/disclaimer/
