In today’s Asia Morning Briefing, the cryptocurrency market faces significant tension as Bitcoin enters the trading day in the mid-$70,000s, indicating bearish signals amid a global search for market direction. Recent data from CryptoQuant reveals a concerning trend, with the Bull Score Index dropping to zero, suggesting that the current market conditions are structural rather than cyclical. Analysts note that Bitcoin is struggling to regain its stature following its peak last October, operating within a diminished buyer base and tightening liquidity.
Supporting this assessment, Glassnode’s data points to feeble spot volumes and a noticeable lack of demand, where selling pressure remains unchallenged by consistent absorption rates. This indicates that the current climate is less about panic and more reflective of declining participation in the market.
A notable shift in institutional flows reinforces this narrative. U.S. spot Bitcoin ETFs, once net accumulators at the same time last year, have transitioned to net sellers, creating a significant year-over-year demand gap translating to tens of thousands of Bitcoin. Additionally, the Coinbase premium has remained negative since October, illustrating that U.S. investors are not engaging meaningfully even as prices have dropped. Historically, vigorous bull markets have thrived on strong U.S. spot demand, and this critical engine currently appears to be stalling.
Moreover, liquidity conditions are tightening significantly, with the expansion of stablecoins, typically a precursor to increased risk appetite and trading activity, much weaker than expected. Notably, the market cap growth of USDT turned negative for the first time in 2023. This downturn in demand suggests that the decline isn’t simply a result of leveraged trading but a broader retreat in market participation.
From a technical perspective, Bitcoin remains below its 365-day moving average, with valuation bands indicating significant support between the $70,000 and $60,000 range. The macro environment adds another layer of complexity, revealing that Bitcoin is now correlating more closely with high-beta tech stocks rather than being viewed as a safe haven like digital gold. Prediction markets currently anticipate no changes in the Federal Reserve’s April meeting decisions, fueling only mild expectations for a potential rate cut in June.
Political dynamics further complicate the landscape. President Donald Trump recently commented on his nominee for the Federal Reserve chair, Kevin Warsh, suggesting that a chair wishing to raise rates would not have been selected. This signals potential risks to the perceived independence of the central bank, thus impacting market sentiment.
As for specific market movements, Bitcoin has slipped lower into the mid-$70,000s, failing to maintain momentum following a brief test of support, with technology stocks similarly experiencing pressure. Ether (ETH) remains just above the low $2,000s but struggles with momentum as risk sentiment continues to decline, and major exchanges show muted trading flows. In commodities, gold prices rebounded towards the $5,000 to $5,100 range, gaining ground as safe-haven investments surged amidst rising U.S.–Iran tensions and softer private payroll data that clouded the economic outlook under Trump’s newly nominated Fed chair.
In the equities space, Japan’s Nikkei 225 eased by about 0.3%, reflecting the tech-heavy sell-off seen on Wall Street, although broader Japanese stocks maintained relative resilience compared to regional counterparts.
In other news from the cryptocurrency sector, Binance has denied issuing any legal threats tied to insolvency allegations, while Kyle Samani, co-founder of Multicoin Capital, is stepping down after nearly a decade to pursue other technology ventures.
