Reasons Bitcoin fell below $100k: ETF movements and market cooling mechanisms

Bitcoin(BTC) has fallen below $100,000, and the market is entering a turning point. The current BTC price is around $87,110, down 0.51% over the past 24 hours. To understand this correction phase, it is necessary to consider multiple factors simultaneously.

ETF Outflows Indicate Decreased Demand

Recently, net outflows from Bitcoin ETFs have been prominent. This signifies a slowdown in new capital inflows, exerting supply pressure on the market. The withdrawal of funds from mainstream investment channels like ETFs reflects a cautious stance among institutional investors.

Overextended Position Adjustment Phase

Attention should be paid to two key indicators: funding rate and open interest. The interest rate indicates how much market participants have staked on their positions. These figures had reached very high levels, indicating that the overall market was excessively bullish. Such overheating conditions make a correction inevitable.

Deteriorating Macro Environment and Headwinds for Risk Assets

Global financial markets are becoming more unstable. The scenario of U.S. rate cuts has diminished, and bond yields have resumed an upward trend. In this environment, risk assets like Bitcoin are more susceptible to selling pressure.

Large Players Taking Profits

After a rapid upward trend, whales and institutional investors are accelerating profit-taking. This large-scale selling pressure is considered one of the factors contributing to the current decline.

Next Steps for the Market

This decline is not disorderly but can be seen as the market awakening from excessive excitement and preparing for the next phase. As weak positions are weeded out, the long-term bullish trend of Bitcoin remains intact.