Crypto Markets Stabilize After Record $20B Deleveraging as Structural Demand Holds
Crypto markets saw their largest-ever leveraged liquidation, wiping out speculative positions but leaving long-term capital largely intact. According to Glassnode and CryptoQuant, steady whale accumulation, rising USDT supply, and ongoing ETF inflows continue to support the market despite short-term volatility.
Analysts note that while the liquidation shook traders, underlying liquidity and structural demand remain strong, signaling resilience in the market’s foundation.
Structural Demand Remains Robust
CryptoQuant highlights that large holders are continuing to accumulate, even as short-term momentum softens. The USDT supply has surged nearly $15 billion over the past 60 days, marking the fastest growth since January, while U.S. spot Bitcoin ETF inflows have reached $3.5 billion.
Glassnode echoes this view, interpreting these trends as evidence that capital has remained inside the system, even after speculative risk was flushed out.
Divergent Market Perspectives
The two firms differ in tone and timing:
- Glassnode characterizes the sell-off as a structural purge that removed speculative excess and forced traders into defensive positions. Funding rates have halved, perpetual CVDs turned negative, and options traders are paying higher premiums for downside protection. Glassnode views the market as digesting losses and rebuilding confidence, rather than gearing up for an immediate rebound.
- CryptoQuant takes a more constructive approach, highlighting $115,000—the on-chain realized price for traders—as a critical level. A sustained move above this threshold could mark the beginning of a new bullish phase, fueled by expanding stablecoin liquidity and continued whale accumulation.
This contrast reflects a broader market divide: a cautious reset versus a potential inflection point.
From Excess to Equilibrium
Both reports suggest the market is transitioning from excess to equilibrium. Capital continues to flow through ETFs and stablecoins, but positioning remains defensive, and confidence will need time to rebuild. Bitcoin’s next move—whether a rebound or a longer consolidation—will depend on how quickly structural demand translates into fresh risk-taking.
Market Snapshot
BTC: Bitcoin fell to approximately $112,700 after briefly trading below $110,000. Profit-taking and renewed trade tensions from President Trump pressured risk assets, though prices stabilized following Fed Chair Jerome Powell’s comments signaling the end of the tightening cycle is near.
ETH: Ether traded around $4,101, down 3.7%, as open interest hit its lowest level since May. Profit-taking accelerated after rejection near $4,270, but CME traders and ETF inflows indicate continued institutional support.
Gold: BlackRock’s Evy Hambro predicts gold could climb past $4,200 amid repricing of paper currencies against real assets, while Bank of America projects gold at $5,000 and silver at $65 by 2026, citing fiscal deficits, strong investor demand, and structural shifts favoring real assets, though short-term consolidation risks remain.
Nikkei 225: Asia-Pacific markets opened higher on Wednesday, with Japan’s Nikkei 225 up 0.3%, despite ongoing U.S.-China trade tensions and threats of “retribution” from President Trump keeping volatility elevated.
