Key takeaways:
– Bitcoin derivatives show persistent fear despite the rally toward $70,000, with futures premiums pinned well below neutral levels.
– Caution stems from broad risk aversion and lingering concerns over institutional BTC liquidations and network security.
Bitcoin (BTC) retested $70,000 on Wednesday after recovering from Tuesday’s low near $62,500. Inflows into US-listed Bitcoin exchange-traded funds helped steady sentiment, but derivatives markets remain wary, and traders see obstacles to a sustained climb to $75,000.
US-listed Bitcoin ETFs recorded about $764 million in net inflows over two days, offsetting part of the $1.2 billion of outflows across the prior eight trading days. Those large swings are typically linked to institutional activity, suggesting demand increases when prices dip below roughly $65,000.
Despite ETF demand, appetite for leveraged long positions in BTC futures has waned. The annualized two-month futures premium over spot was about 2% on Thursday, well under a typical 5% neutral threshold. Bullish conviction has been muted since Jan. 31, when BTC lost the $85,000 support level it had held for nine months. Options data likewise show professionals favoring protection over directional exposure.
Put options traded at roughly a 14% premium to equivalent calls on Thursday, indicating elevated demand for downside protection; a neutral skew usually moves between -6% and +6%. That metric improved from a 28% “panic” reading earlier in the week, but the rebound to $70,000 has done little to shift derivatives traders’ cautious stance.
Is a single entity behind Bitcoin’s weakness?
Several unproven theories have been floated to explain Bitcoin’s roughly 32% decline over seven weeks, a slide that accelerated after the Oct. 10, 2025 crash which wiped out about $19 billion in leveraged positions across crypto. That period also coincided with U.S. announcements of tariff increases on Chinese imports.
Binance reportedly paid $283 million in compensation to users affected by liquidations tied to oracle pricing errors, latency and asset transfer issues; former CEO Changpeng “CZ” Zhao has denied any intentional role in triggering the October crash. Other market participants point to fears over quantum computing and long-term security—concerns that surfaced after a Jefferies strategist removed BTC from a “Greed & Fear” model portfolio in January. Developers have proposed BIP-360 to advance onchain post-quantum cryptography.
Another recent narrative centers on quantitative trading firm Jane Street. Claims intensified after Terraform Labs’ administrator sued the firm, alleging insider trading tied to transactions that sped the 2022 Terra collapse. Jane Street’s 13-F filing showed sizable positions in BlackRock’s iShares Bitcoin Trust and mining companies, but analysts note such holdings can be consistent with delta-neutral strategies.
Broader risk-off signals also matter: Nvidia shares fell about 5% Thursday despite strong earnings, a move that underscores growing risk aversion among investors and may help explain why Bitcoin struggles to reclaim $75,000.
This article does not contain investment advice. Every investment and trading decision involves risk; readers should do their own research. While efforts are made to provide accurate information, accuracy and completeness are not guaranteed, and Cointelegraph is not liable for losses from reliance on this material.
