- Bitcoin’s sharp 12% drop to $83,600 in 48 hours triggered a 35% trading volume surge, signaling heightened market activity.
- Despite short-term losses, institutional holdings rose to $48 billion, reinforcing confidence in Bitcoin’s long-term value and stability.
Bitcoin has seen a sharp decline, dropping from $95,000 to $83,600 in just 48 hours—a staggering 12% loss on Tuesday.
The trading volume surged by 35%, signaling heightened market activity. Meanwhile, the Coinbase Premium Index, a key indicator of investor sentiment, slipped to -0.072, suggesting bearish pressure.
Despite that downturn, market fundamentals tell a different story. CryptoQuant CEO Ki Young Ju remains optimistic, emphasizing that a slowdown does not mean the bull run is over. He believes that retail traders do not hold the reins in determining Bitcoin’s future. Young Ju stated:
There’s no significant on-chain activity, and key indicators are neutral, suggesting the bull cycle is still intact,
Instead, major players such as institutional investors, mining companies, and even former U.S. President Donald Trump will shape the market’s direction.
Institutional holdings reinforce that stance. According to CoinGecko, traditional finance (TradFi) firms now hold $48 billion worth of Bitcoin, marking an 8% increase since January 2025. That steady accumulation hints at enduring confidence in the asset’s long-term value, even as short-term price swings rattle smaller traders.
On-chain activity, however, remains stagnant. BTC transactions have declined over 34%, reinforcing the broader sentiment of market consolidation. Analysts are closely watching the next move with the Bitcoin market cap sitting at $1.74 trillion, down 6% from its high of $1.85 trillion.
Bitcoin could experience a steep 30% correction if the bull cycle officially ends, possibly sinking to $80,000. However, historical patterns suggest a different scenario. Bitcoin’s longest bear market lasted 410 days, yet current data points toward a more modest 60-day consolidation phase rather than a prolonged downturn.
U.S. Policy Moves Could Steer the Next Rally
Beyond price charts and mining stats, U.S. crypto regulations loom large over the market’s trajectory. Trump’s administration has signaled an intent to position the U.S. as a leader in the digital asset space. The recently established Crypto Council has yet to finalize regulatory policies, but optimism is growing among traders.
Adding to that bullish sentiment, Trump’s latest remarks regarding the U.S. Strategic Reserve sparked fresh speculation. He confirmed that XRP would be included in the list of digital assets the government intends to stockpile, fueling expectations that Ripple’s ongoing legal battle with the SEC may reach a favorable resolution.
That development could shift market sentiment dramatically. If the U.S. takes a friendlier stance on digital assets, it could serve as the much-needed catalyst for Bitcoin’s next leg upward. Ju has pointed to this very factor, asserting that the broader market will likely remain in a holding pattern until clearer signals emerge from Washington.
