Key Highlights:

• Over $3.5 billion in ETF investments last week alongside diminished exchange reserves highlights renewed institutional confidence in Bitcoin.
• Healthy futures open interest alongside Bitcoin’s growing adoption indicates that traders foresee Bitcoin challenging the $150,000 mark soon.

Bitcoin (BTC) experienced a 4.2% drop on Tuesday after hitting an all-time high of $126,219 the prior day, a pullback many anticipated following a 12.5% weekly increase. Despite concerns of a deeper downturn and rising global economic uncertainties, Bitcoin’s derivatives and institutional inflows continue to suggest the potential for additional growth.

Bitcoin two-month futures annualized premium. Source: laevitas.ch

Bitcoin monthly futures currently trade at an 8% annualized premium in contrast to standard spot markets, remaining comfortably within the neutral range of 5% to 10%. Peaks of increased confidence tend to push this spread over 20%, signaling higher demand for leveraged long positions. Conversely, down markets typically drop this indicator below 5%, which is not the situation now.

Although the tepid confidence among derivative traders may seem negative, it actually mitigates the risk of widespread liquidations in the event Bitcoin’s price falls further. Additionally, data indicates that the recent rally after the $109,000 retest on September 26 was propelled by real capital inflow rather than mere speculation. The longer Bitcoin maintains above $120,000, the stronger the bulls’ faith grows.

Institutional Inflows and Corporate Reserves Bolster Bitcoin’s Market Position

Institutional acceptance continues to favor Bitcoin, establishing its status as digital gold. Regardless of when another all-time high is achieved, Bitcoin has seen a remarkable 31% increase year-to-date in 2025, significantly outpacing the S&P 500’s 14% growth. Net inflows into publicly-traded Bitcoin products serve as a reliable barometer of institutional interest.

Weekly ETF / ETP net inflows by asset, USD million. Source: CoinShares

The reported $3.55 billion in weekly net inflows into Bitcoin exchange-traded products, which include ETFs, has brought total assets under management to $195.2 billion, clearly indicating increasing institutional uptake. In comparison, listed products backed by silver—which have a market cap similar to Bitcoin’s—total around $40 billion.

Bitcoin investment firms like Strategy and Metaplanet persist in purchasing BTC as a reserve asset, affirming its identity as a standalone asset class. The Brazilian firm OranjeBTC commenced trading on the stock exchange this Tuesday after acquiring 3,675 BTC, worth in excess of $445 million at current market rates.

Bitcoin Exchange Reserves Plummet to a Five-Year Low

Bitcoin balance on exchanges, BTC. Source: Glassnode

Bitcoin balances on exchanges have declined to their lowest levels in over five years, highlighting reduced liquidity available for instantaneous sale. According to Glassnode, total exchange balances now amount to 2.38 million BTC, down from 2.99 million just a month prior. While major purchasers can still access supply through over-the-counter desks, the shrinking exchange balances indicate ongoing accumulation.

Decreased Bitcoin Deposits and Resilience of Derivative Markets Favor Bullish Trends

Bitcoin futures aggregate open interest, USD. Source: CoinGlass

Current open interest in Bitcoin futures across leading exchanges remains at $72 billion, down 2% from Monday but still strong. A solid and liquid derivative market is essential for attracting fund flows from global hedge funds and investors, even when it necessitates demand for short positions.

Bitcoin’s positive momentum could hinge on reduced risks from inflated stock market valuations. Traders disposed of Oracle (ORCL) shares on Tuesday following reports revealing the company experienced shrinking profit margins in its cloud server sector, primarily in rentals of Nvidia chips aimed at the AI industry.

Although a short-term consolidation is still an option, the robustness of Bitcoin’s derivatives market and sustained institutional interest are propelling further upside, with optimistic investors aiming for a price of $150,000 or higher by year-end.