Bitcoin is struggling to extend its recent rebound as on-chain data suggests the market remains vulnerable to sharper price swings. Blockchain analytics firm Glassnode, in its latest BTC Market Pulse update, said the cryptocurrency is consolidating around $64,500, supported by improving investor profitability and relatively stable derivatives markets.
However, it warned that rising short-term trading activity is increasing the risk of heightened volatility. Bitcoin recovered from below $58,000 before stalling near $64,500 as buyers and sellers searched for a new balance. As of writing, according to CoinMarketCap, the top cryptocurrency was trading at $65,380, up 1.28% in the past 24 hours.
“$BTC is consolidating near $64.5K, supported by strong profitability and stable derivatives,” the firm said in a post on X. “Rising hot capital and sell-side pressure, however, leave the market increasingly sensitive to volatility.”
While spot Bitcoin trading has slowed, activity in derivatives markets continues to grow. Futures open interest climbed to $32 billion and options open interest rose to $30.1 billion, showing traders are maintaining exposure through leveraged products. Lower funding rates also suggest bullish positions are being built more cautiously than during previous rallies.
In addition to that, options markets reveal a reduction in short-term worries as volatility spreads have decreased and the need for downside protection has been reduced owing to the move toward a neutral options structure.
U.S. spot Bitcoin ETFs attracted $76.2 million in net inflows last week, while trading volume climbed to $9.4 billion. The analytics firm also said the ETF MVRV ratio rose to 1.04, suggesting many ETF investors have returned to roughly breakeven following Bitcoin’s recent pullback.
On-chain activity also showed signs of improvement. The number of active addresses edged higher and adjusted transfer volume posted double-digit growth. Even so, Glassnode said monthly realized capital remains negative, indicating investors are still holding back from committing significant new money despite improving market conditions.
Glassnode said long-term Bitcoin holders continue to account for most of the market’s supply, limiting speculative activity despite recent price swings. At the same time, so-called “hot capital” coins that have changed hands recently now makes up about 18% of network liquidity, making the market more sensitive to shifts in investor sentiment.
The data suggests Bitcoin’s long-term investor base remains intact even as short-term trading activity increases, leaving the market more vulnerable to sharp price swings if selling pressure builds.
