Bitcoin’s Fate Hangs at $92.5K: Next Move Could Be Massive

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February 22, 2025 by Mishal Ali

Key Takeaways

Bitcoin is consolidating between $93K and $97K as market momentum weakens.
Capital inflows are slowing, with Ethereum and Memecoins experiencing outflows.
Futures markets show a decline in speculative activity, with funding rates turning bearish.

Bitcoin has remained in a tight trading range between $93K and $97K, reflecting a period of market consolidation. This stagnation follows an unsuccessful attempt to break into price discovery in late January 2025. Glassnode reported that Bitcoin’s price momentum has faded, leading to a broader market cooldown.

Bitcoin surged 48.4% in November 2024 but dipped 5.9% by February 2025. Ethereum gained 60.3% in December but is now down 16.9%. Solana peaked at 11.8x in early 2025 and is now at 7.6x. Memecoins hit 5.2x since 2023 but dropped 37.4% recently. BTC remains stable, while Solana and Memecoins show high volatility. Ethereum lags behind its competitors.

Weakening Capital Inflows and Futures Markets

The slowdown in the inflow of funds helped to slow BTC’s pace. While in the past, Solana attracted huge inflows, the latest figures are indicative of a downturn in all the digital currencies.

Ethereum and Memecoins also flipped into the red in net flows, Ethereum posting a 0.1% outflow and Memecoins posting a 5.9% decrease in realized capital. This flip implies cooling off in the desire to speculate and the shift to holding the capital.

Perpetual futures are losing vigor, and Bitcoin’s open interest falls by 11.1%, Ethereum by 23.8%, and Memecoins by 52.1%. This suggests less leverage in the face of weaker trend and uncertainty. Funding rates also support bear sentiment because Solana entered the red and Memecoins plummeted, leaning in the favor of short buyers.

Bitcoin’s Critical Support Level at $92.5K

Bitcoin’s current trading range places it just above the STH cost basis of $92.5K. Historically, this level has served as a pivotal point between bullish and bearish phases. If BTC drops below this threshold, many recent buyers will find themselves in an unrealized loss, potentially triggering panic selling.

Previous post-ATH corrections in May 2021, Nov 2021, and last month in April 2024 were also tracked in the same pattern. Bitcoin’s price each time reverted to the bottom end of the STH cost basis model, currently at about $71.6K. Bitcoin could experience further downward risks if the trend continues to remain in effect unless there’s heavy buying pressure.

Despite these problems, institutional demand for Bitcoin ETFs remains intact. Even if inflows last week averaged above $200M a day, the immediate comeback in the rate at which purchasing activity picked up suggests consistent demand from the institution side. Ethereum-based funds, in contrast, could only muster significant inflows, affirming weaker market standing.

Bitcoin’s consolidation period also appears to be at the decision point. It could establish a new upper boundary above the ATH if demand continues to support it. A breakdown in the extended purchasing pressure, in turn, could see a larger correction, in alignment with previous post-ATH trends.

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