Bitcoin Price Movements Resemble Early 2022 as Underwater Supply Drops Below 30%

Bitcoin Price Movement: Bitcoin has experienced a two-week decline, approaching the True Market Mean, with current prices around $96.1K, indicating a significant portion of total supply is underwater. The market is at a critical juncture, with the 0.85 quantile at $106.2K being a key resistance level.

Market Sentiment and Demand: Spot demand has weakened, with U.S. Bitcoin ETFs seeing net outflows and cumulative volume delta turning negative, suggesting reduced institutional interest and increased vulnerability to market shocks.

Derivatives and Options Trends: Futures open interest has been declining, and funding rates have cooled, indicating a neutral market positioning. Implied volatility has also dropped, reflecting uncertainty among traders about future price movements.

Market Manipulation Concerns: Crypto entrepreneur Lark Davis highlighted a potential coincidence where major financial institutions began offering crypto services to clients shortly after significant market sell-offs by crypto whales, raising questions about market manipulation.