Bitcoin [BTC] has witnessed significant price volatility in recent times, mainly influenced by the outcomes of the Federal Open Market Committee (FOMC) meeting and the speech delivered by Federal Reserve Chair Jerome Powell.
The digital asset experienced a sharp decline, dropping to around $98,000—an over 5% decrease in just a single day. However, Bitcoin quickly bounced back, surpassing the $100,000 mark and briefly hitting a peak of $105,000 earlier today.
As of the latest update, Bitcoin was trading at $101,496, showing a 2.6% decrease over the past 24 hours and a 6.1% drop from its all-time high (ATH).
This significant price swing highlights the ongoing volatility of Bitcoin, reflecting both the challenges and the resilience of investor confidence. Analysts have been closely monitoring these fluctuations, focusing on institutional activities and their impact on market trends.
A new report from CryptoQuant analyst Burak Kesmeci sheds light on a notable development in the dynamics of the Bitcoin market.
Major Outflow from Coinbase Indicates Institutional Interest
According to Kesmeci, a record-breaking Bitcoin outflow was observed on Coinbase during the FOMC announcement. Within just one hour, approximately 10,756 BTC, with a total value of $1.1 billion, were withdrawn from the exchange.
The transaction took place in two significant blocks: one involving 8,093 BTC and the other 2,557 BTC. This substantial outflow strongly suggests institutional purchases or intermediary transactions possibly linked to Spot ETF demand—a trend that aligns with similar institutional activities seen over the past year.
Kesmeci underscored the increasing role of institutional investors in shaping Bitcoin’s market dynamics.
“U.S. investors are continuing to accumulate Bitcoin persistently, showing resilience against price fluctuations and market downturns.”
The analyst highlighted that these substantial transactions highlight the impact of institutions like RIOT and MARA in driving market momentum, especially during crucial events such as interest rate announcements.
Bitcoin Metrics Present Varied Short-Term Outlook
While institutional transactions point towards a bullish long-term sentiment, other essential metrics portray a mixed picture concerning Bitcoin’s immediate future.
Data from Coinglass indicates a 0.90% decline in Bitcoin’s open interest, now standing at $68.14 billion. Conversely, Bitcoin’s open interest volume has surged by 36%, reaching $148.57 billion—a sign of increased trading activity.
Another critical metric, the MVRV (Market Value to Realized Value) ratio, has also experienced notable changes. The MVRV ratio assesses whether Bitcoin is overvalued or undervalued based on its current market price in comparison to its realized value.
A ratio above 1 generally signifies profitability for holders, while higher values indicate potential overvaluation. Bitcoin’s MVRV ratio recently rose to 2.69 but has now dropped to 2.52 following the price correction.
This decline suggests a calmer market sentiment, with traders likely reassessing their short-term positions.