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- Institutional activity is shaping Bitcoin’s price, with Matrixport noting a 60% market dominance on February 26.
- Analysts highlight Trump’s tariffs and a potential delay in Bitcoin Reserve talks as factors driving market instability.
- Bitcoin ETFs saw $1.1 billion in outflows over five days, coinciding with sharp declines in crypto related assets.
Institutional activity is emerging as a key influence on the Bitcoin price, this is as stated by Singapore based blockchain firm, Matrixport, in its report dated February 26. Bitcoin is still dominating the market as it maintains 60% market share to be the major reference for traders, but its volatility in recent weeks demonstrates Wall Streets impact in crypto.
Matrixport Analysts’ Observations
As noted by Matrixport analysts there are several factors that have caused market instability in the recent past. Some factors include doubts surrounding the proposed tariffs by the former President Donald Trump and the possible deferment of the Bitcoin Strategic Reserve consultation for up to six months. These aspects might explain what the analysts has described as ‘technical topping formation’ where the price of Bitcoin might be headed to its next support level of $73,000.
At the moment, Bitcoin fluctuates at $88,290; when it dropped to $86,099 the whole market was affected erasing $1.06 billion. The losses were mainly incurred by the long position which lost $873 million and over 220,000 trading accounts were closed at the low. CoinGlass reported that there is an indication that open interest has dipped by 5% showing that traders are taking a step back. Furthermore, the value of exchange inflows increased by 14.2% likely due to panic selling as they resulting to falling prices.
Bitcoin ETFs See Outflows
Bitcoin ETFs peaked to consistent outflows within five days, with a total outflow of $1.1 billion, $516 million of which was on 24 February. This also affected cryptocurrency-associated stocks, where major market players saw their stock prices drop considerably. There was some impact as Marketplaces, such as Coinbase (COIN), declined 6.4% and Robinhood (HOOD) by 8%.
However, it is significant to understand that analysts continue to keep their eyes on the potential technical indicators in the Bitcoin market. A higher price above $93,000 could assist the asset to reestablish an upward movement, and further decline below the $85,000 level may intensify bearish pressure. The performance of Bitcoin particularly within the following weeks will be expected to be stable in light of institutional traders and macroeconomic forces.
Increasing institutional interest defines the advancement of Bitcoin to a different phase. Market participants have now a task to overcome the traditional high volatility of cryptocurrency and the changing winds of economic policy and big trading volumes. The next few days will decide whether the crypto will start to rise or will experience another serious drop.
