Looking at the funding rate, an indicator of market overheating, long bets have recently increased but remain much smaller compared to previous peaks. The futures market overheating is negligible.
By examining the proportion of bitcoins traded within 1 week to 1 month, we can assess short-term capital inflow and determine market overheating. Although Bitcoin’s price has reached an all-time high, short-term capital inflow is not as rapid as during past peaks.
Few short-term holders have taken profits during the recent rise. In March 2024, there was significant profit-taking and a prolonged correction, but currently, profit-taking is much lower than in November 2024. Despite the price at an all-time high, whales’ profit-taking activity remains limited.
Bitcoin holdings in spot ETFs have also reached an all-time high. The increased holdings by both retail and institutional investors, especially in the US, significantly support the overall market uptrend.
Summary:
Recent overheating indicators such as the funding rate and short-term capital inflow remain low compared to previous peaks, and profit-taking by short-term investors is limited. Bitcoin holdings in spot ETFs have hit all-time highs, reflecting growing institutional interest. Overall, the Bitcoin market is still in a healthy upward phase.
Written by Crypto Dan
