Bitcoin Price Prepares for Volatility as Spot Supply Dwindles
The recent Bitcoin rally occurred when funding rates turned negative and BTC holdings on exchanges and OTC markets were reduced. The price of Bitcoin (BTC) has steadily risen, even as trading volumes have fallen to their lowest levels since the start of the 2023-2026 cycle. Retail investor activity is subdued, and funding rates in perpetual swaps recently grazed negative territory. It is an unusual scenario for a price approaching all-time highs.
However, beneath the surface, on-chain data points to something more: a phase of quiet accumulation. Although the market appears calm, supply is quietly dwindling. With open interest in Bitcoin futures near all-time highs, the market is very tense, setting the stage for a perfect storm.
