Report: Bitcoin Institutional Buyers Yet to Stage Comeback, Market Still in Consolidation Phase

On March 17th, Bitfinex put forth a new report indicating that Bitcoin has been in a continuous decline ever since reaching a historical high of $109,590 on January 20th. The lowest point last week was $77,041, representing a 29.7% pullback, which marks the second deepest correction within this bull market cycle. While in history, bull markets usually witness a 30% retracement before resuming the upward trend, in this cycle, there had been shallower declines previously due to institutional adoption and ETF-driven demand. Short-term holders continue to endure unrealized losses, which intensifies the selling pressure. These investors, especially those who purchased in the past 7 to 30 days, are typically the most prone to giving up. Historically, when fresh capital inflows slow down and the cost basis trend changes, it suggests a weakening demand environment. With Bitcoin struggling to maintain key levels, this trend is becoming more evident. In the absence of new buyers entering the market, Bitcoin may experience a prolonged consolidation period or even further declines as weak hands continue to exit. A crucial factor to keep an eye on is whether long-term holders or institutional demand will reemerge at these lower levels. If deep-pocketed investors begin to absorb the supply, it could signify a shift towards an accumulation phase, stabilizing price movements and reversing market sentiment.