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Extreme fear surrounding Bitcoin (BTC) is rapidly subsiding, but the cryptocurrency remains stuck around the $68,000 level, reflecting a strong wait-and-see sentiment. While panic selling has come to a halt, the absence of fresh buying and institutional inflows suggests that improving macroeconomic indicators may be the only catalyst capable of breaking the current stalemate.
According to investment outlet FXStreet on February 17 (local time), Bitcoin’s 30-day implied volatility has plunged to an annualized rate of 52%, signaling growing market stability. Earlier this month, when Bitcoin tumbled near $60,000, this fear gauge had soared to nearly 100%. Its decline by half indicates that investors are no longer frantically seeking hedges or options against further price drops, and that deleveraging pressure in the derivatives market has eased considerably.
Although panic has cooled, prices remain under heavy pressure. Bitcoin slipped 1.2% over the past 24 hours to trade below $68,000. Since staging a technical rebound near $60,000 on February 6, it has failed to firmly reclaim the $70,000 level, underscoring the fragility of the market’s fundamental buying base.
Key indicators in the derivatives market also point to consolidation rather than aggressive buying. The funding rate, which balances spot prices and perpetual futures contracts, is just barely above zero, reflecting only mild bullish sentiment among traders. However, this has yet to translate into leveraged re-entry or significant new capital inflows that would signal strong upward momentum.
Cooling institutional appetite is also weighing heavily on any potential rebound. According to data analytics platform SoSoValue, U.S.-listed spot Bitcoin exchange-traded funds (ETFs) recorded a substantial net outflow of $677.98 million this month alone. This marks the third consecutive month of redemptions, highlighting a deepening capital exodus among institutional investors.
Ultimately, embattled bulls are pinning their hopes on macroeconomic data. U.S. consumer prices slowed to 2.4% last month from 2.7% in December, boosting expectations for a Federal Reserve rate cut. Meanwhile, the real yield on the 10-year U.S. Treasury, adjusted for inflation, has fallen to 1.8%. Analysts believe that declining real yields and improving global liquidity conditions could significantly enhance the relative appeal of non-yielding risk assets like Bitcoin, providing a strong tailwind for future gains.
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