Bitcoin and the Crypto Market – A Turning Point ?
Bitcoin (BTC) has been on a rollercoaster, shaking up the crypto market with a steep drop. After hitting an all-time high of over $100,000, BTC slipped nearly 30%, triggering panic and speculation. Is this the bottom, or just another dip before a recovery? Let’s break it down.
Bitcoin ETF Flows Shift as Crypto Market Recovers
Bitcoin ETFs finally broke their eight-day outflow streak on the last day of February, seeing $94.3 million in inflows. This marks a potential shift in sentiment after a brutal sell-off that saw over $3.2 billion pulled from these funds. The massive outflows coincided with Bitcoin’s price drop to $78,000, its lowest point in months.
While some major ETFs, like BlackRock’s iShares Bitcoin Trust (IBIT), continued to see large withdrawals—losing $244.6 million in a single day—others showed signs of recovery. Fidelity’s FBTC gained $176 million, while ARK 21Shares Bitcoin ETF led with $193.7 million in inflows.
This turnaround came as Bitcoin bounced back above $84,000, signaling that investor confidence may be returning. The upcoming Trump crypto summit and BlackRock’s decision to add a 1-2% allocation of its Bitcoin ETF to one of its model portfolios could further boost demand. If inflows continue, this could be a key moment in stabilizing the crypto market.
Finding the Bottom
Crypto analysts are looking at specific price levels to determine where Bitcoin might bottom out. One critical area is the CME futures gap between $78,000 and $80,700. Historically, BTC tends to fill these gaps before making a decisive move. Currently, liquidity is stacking up in the $70,000-$80,000 range on Binance, signaling that some traders believe the bottom is near.
Some experts, like BitQuant, think BTC could drop to the mid-$70,000s before reversing. Others point to the $80,500 level as a must-hold support. If Bitcoin stays above this zone, it could stabilize and push higher. Otherwise, another wave of selling might follow.
Crypto Market Activity and Capitulation Signals
Despite the fear, some metrics suggest a potential turnaround. Bitcoin’s active addresses surged to 912,300 on February 28, a level not seen since December 16, 2024, when BTC traded around $105,000, according to Glassnode. Historically, spikes in on-chain activity have aligned with market peaks and bottoms, as panic sellers exit and opportunistic buyers enter.
According to IntoTheBlock, this surge in active addresses could signal a “capitulation moment” for the crypto market. Capitulation occurs when investors sell in panic, driving prices down before a major reversal.
Further supporting this, Coinglass data shows that over $3 billion in crypto long positions were liquidated over five days, reflecting extreme market turbulence. High liquidation levels often precede price stabilization, as selling pressure exhausts and new buyers step in.
Glassnode’s MVRV Z-score also hints at a potential bottom. This indicator, which measures whether BTC is overbought or oversold, has entered a zone that typically precedes price rebounds. While no single metric guarantees a reversal, these signs suggest that Bitcoin might be approaching a crucial turning point.
Bitcoin’s active address count reached its highest daily level since December 2024, potentially signaling a capitulation moment.
Historically, spikes in on-chain activity have often coincided with market peaks and bottoms—driven by panic sellers exiting and opportunistic… pic.twitter.com/m00G7PfquJ
— IntoTheBlock (@intotheblock) February 28, 2025
Trump’s Crypto Summit and Its Impact
Adding to the mix, former U.S. President Donald Trump has announced a crypto summit on March 7. The event will feature industry leaders, investors, and policymakers. This move signals Trump’s ongoing support for the crypto market and could shape future regulations.
The announcement coincided with Bitcoin’s price bouncing back above $84,000. It’s unclear whether this rally will last, but the political spotlight on crypto could attract fresh interest and investment. Additionally, BlackRock’s decision to allocate 1-2% of its model portfolios to Bitcoin ETFs may fuel institutional demand in the coming months.
What’s Next for Bitcoin and the Crypto Market?
While Bitcoin has faced significant headwinds, the crypto market has seen worse. The Fear & Greed Index, which dropped to an extreme fear level of 10, has started recovering, signaling improving sentiment. If BTC holds key support levels and ETF outflows slow, a recovery could be on the horizon.
However, risks remain. Another dip below $80,500 could trigger massive liquidations, sending prices lower. Investors should watch on-chain activity, ETF flows, and macroeconomic trends closely.
In conclusion, Bitcoin’s latest dip might be painful, but it could also be a setup for a stronger recovery. With growing adoption, political interest, and technical indicators flashing potential support, the next few weeks will be crucial. The crypto market is at a turning point—whether it’s up or down remains to be seen.
