Bitcoin is facing a renewed supply test as on-chain dynamics show rising balance on spot venues and ongoing ETF outflows. In the latest week, exchange netflows rose by roughly 18,000 BTC, while spot BTC exchange-traded funds logged net outflows of nearly 16,000 BTC, a combination that produced around 34,000 BTC of local selling pressure across venues.

Axel Adler Jr., a BTC researcher, said the data point to a persistent local supply imbalance even as price movements suggested a rebound. “BTC exchange and ETF activity continue to show a local supply imbalance,” Adler noted in his assessment of the week’s flow figures, underscoring that the pressure could resurface if absorption by buyers does not improve. He added that the weekly netflows imply that the market may need a shift back toward neutral or negative exchange balances before sustained upside momentum can take hold. Read his full analysis.

Bitcoin weekly exchange netflows. Source: CryptoQuant

The same period also saw spot ETF activity retreat, with net outflows of around 16,000 BTC. Adler noted that institutional flows did not absorb the exchange supply as hoped and, instead, reinforced a risk-off mood that can cap rallies in the near term.

The magnitude of the combined pressure—roughly 34,000 BTC across exchanges and ETFs—highlights the fragility of near-term upside without stronger spot demand. As Adler framed it, the market faces a critical test: can buyers step in sufficiently to absorb ongoing inflows and prevent a renewed slide in supply pressure?

Bitcoin open interest, CVD, and funding dynamics. Source: Velo chart

The wider market context added to the caution. Glassnode analyst cryptovizart pointed out that daily ETF trading volume has cooled to below $20 billion, down from more than $50 billion in late 2025. The softer activity in traditional finance channels suggests fading speculative demand through these venues and weaker spot absorption during rallies. Read the note.

Key takeaways

Weekly BTC exchange netflows rose by about 18,000 BTC, while spot BTC ETFs logged roughly 16,000 BTC in net outflows, creating ~34,000 BTC of near-term selling pressure.
Institutional ETF activity has cooled, with daily ETF trading volume dipping below $20 billion from above $50 billion in late 2025, signaling fading speculative demand through traditional channels.
Open interest on BTC futures declined to about 250,000 BTC during the rebound, before ticking up to roughly 254,000 BTC, suggesting that the rally was driven largely by short-covering rather than new bullish positioning.
Funding rates cooled to around 0.0026, remaining in positive territory, indicating less crowded long leverage even as the market experiences intermittent pressure.
Analysts highlight a mixed signal: while some metrics show cooling selling pressure, sustained upside will likely depend on a renewed burst of spot demand and a rise in open interest toward the $80,000 level.

Derivatives dynamics and the path to momentum

The rebound rally toward the $77,800 area came after a brief dip below $75,000, aided in part by a shift in risk appetite following reports of a potential US-Iran peace deal. On-chain and derivatives data paint a picture of a cautious market where buyers have not yet fully absorbed supply. Aggregated Bitcoin open interest fell from about 268,000 BTC during the dip and then hovered near 254,000 BTC, signaling that the move higher was largely driven by short-covering rather than a broad reloading of bullish bets.

Meanwhile, the aggregation of funding rates softened during the advance, sliding to around 0.0026 from earlier peaks near 0.008—still positive, but a sign that long positions are less crowded than in prior rallies. A separate perspective from Rei Researcher on CryptoQuant notes that the daily funding rate has remained negative since February 2026, implying ongoing pressure from short traders in the shorter horizon. Taken together, these signals suggest BTC is stabilizing around the mid-to-upper $70k range even as near-term headwinds persist.

BTC price, spot CVD, aggregated open interest, and funding rate. Source: Velo chart

In the broader context, Glassnode reported that spot CVD and futures CVD metrics have moved higher—up 77.2% and 35.5% respectively—while price momentum softened. The development underscores a market where selling pressure is easing somewhat on a relative basis, but real momentum will likely require a renewed influx of spot demand and a climb in open interest.

Volatility, risk, and what to watch next

Looking ahead, the critical question for BTC remains whether fresh buyers can step in to absorb ongoing exchange and ETF flows. If spot demand fails to strengthen or if open interest fails to rise in tandem with price, the current relief rally risks stalling or reversing. Observers will be watching for shifts in ETF activity, potential catalysts that can restore risk appetite, and any signs that institutional sentiment is ready to re-engage spot markets on a larger scale.

The market still faces a delicate balance between supply pressure and demand absorption. If buyers re-enter with conviction and open interest climbs toward the levels that historically accompany durable upswings, BTC could eye the $80,000 mark in the months ahead. Until then, the data suggests a cautious stance: a quieting of selling pressure at the margin, paired with a need for stronger spot demand to convert relief rallies into sustainable upside.