Bitcoin bulls and bears clash! Glassnode report: Spot contracts face selling pressure, but ETF buying and long-term investors "hold the bottom steady"

Is Bitcoin’s Trend Falling into a Quagmire?
The latest Week 17 “BTC Market Pulse” report from Glassnode has been released, revealing a market structure filled with “contradictions” and complexity.
Although selling pressure and short-selling sentiment have significantly increased in spot and derivatives markets; strong capital inflows into the US Bitcoin spot ETF, and the unwavering confidence of long-term holders (LTH), are providing a robust downward buffer for the broader market.
(Background: MicroStrategy’s bullish move! Strategy invests an additional $2.54 billion to buy 34k BTC, bringing total holdings to over 815k BTC)
(Additional context: Why has Bitcoin become a key liquidity target amid ongoing geopolitical risks?)

Table of Contents

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• Spot and Derivatives Markets: Increasing Bearish Sentiment and Selling Pressure
• Options and ETFs: Institutional Buying Supports Optimism
• On-Chain Data: Long-term Holders Refuse to Sell, Is the Market Entering a Bottoming Phase?

The Bitcoin market has recently exhibited an extremely complex game-theoretic structure. According to the latest “BTC Market Pulse: Week 17” analysis report from Glassnode, investor behavior and market structure are releasing mixed signals of bullish and bearish forces.

The report notes that although Bitcoin’s recent upward momentum has slightly weakened, the market still maintains strong buying interest, serving as an important cushion against a catastrophic price collapse.

Spot and Derivatives Markets: Increasing Bearish Sentiment and Selling Pressure

On centralized exchanges (CEX), trading activity has noticeably picked up, indicating continued high market participation. However, detailed data reveals short-term concerns:

• Increased Spot Selling Pressure: The Cumulative Volume Delta (CVD) in the spot market has shifted from positive to negative, signaling rising selling pressure and a bearish market sentiment.
• High Willingness to Short in Derivatives: In futures markets, rising open interest (OI) indicates increased risk appetite and price sensitivity. But the significant decline in “long funding rates” and the sharp drop in “perpetual contract CVD” suggest buyers are becoming less aggressive; traders are even willing to pay premiums to establish short positions, indicating brewing bearish sentiment.

Options and ETFs: Institutional Buying Supports Optimism

Contrasting the bearish atmosphere in spot and futures markets, the options and ETF sectors bring encouraging news that bolster confidence.

In the options market, demand for “downside protection” has decreased, implying that extreme bearish sentiment is softening. The contraction in open interest may result from profit-taking or closing positions; meanwhile, the volatility spread indicates market sentiment is transitioning from “high-risk pricing” to a more neutral, stable phase.

In the traditional finance sector, especially the ETF segment, the US spot ETF’s MVRV ratio and net inflow (Netflow) are both rising. These data, combined with increasing trading activity, suggest institutional investors remain eager to participate in Bitcoin through compliant channels, injecting a “cautiously optimistic” momentum into the market.

On-Chain Data: Long-term Holders Refuse to Sell, Is the Market Entering a Bottoming Phase?

From on-chain liquidity and profit/loss data, the market structure remains healthy and balanced:

• Stable Capital Structure: The decline in Hot Capital Share and the improvement in realized market cap (despite being negative) indicate that liquidity is in a dormant state, with net outflows slowing down. Additionally, the ratio of short-term holders (STH) to long-term holders (LTH) remains stable, demonstrating that long-term investors (LTH) are confident about the future and are not panicking into sell-offs.
• Divergence in Profit and Loss Data: Improvements in Net Unrealized Profit/Loss (NUPL) and profit supply percentage signal a potential “stabilization phase,” with immediate selling pressure easing. However, the report also warns that the decline in the “Realized Profit to Loss Ratio” suggests some panic-driven capitulation still exists in the market.

In summary, Bitcoin is currently caught in a tug-of-war between derivatives’ bearish signals and institutional spot buying. With steadfast support from long-term holders and continuous ETF capital inflows, the market is likely to digest short-term selling pressure and then move toward a clearer direction.