U.S. policies affect the world, Bitcoin rebounds while altcoins remain sluggish, MVRV approaches bottom range.

Market Dynamics and Trend Analysis

Macroeconomic Environment and Liquidity

Recently, the global economic situation has been significantly affected by the U.S. tariff policy. The uncertainty of this policy has begun to weaken market confidence in the U.S. economy, and it is expected to continue affecting market trends in the coming months. Meanwhile, U.S. Treasury bonds and the dollar are showing a downward trend, while the U.S. stock market has experienced severe volatility, a situation that is often common in the mid-term of a bear market. The cryptocurrency market has also experienced significant fluctuations as a result.

Market Performance Overview

This week, Bitcoin has seen a significant rebound after a sharp decline, while some smaller cryptocurrencies have plummeted due to being delisted from exchanges. The market overall lacks a clear hotspot direction.

Among the top 300 cryptocurrencies by market capitalization, the five with the largest increases are XCN (110%), FARTCOIN (100%), GAS (60%), LAYER (40%), and UXLINK (30%). The five with the largest decreases are BERA (40%), EOS (20%), MEW (20%), W (20%), and NEAR (20%).

It is worth noting that BERA, as a decentralized financial public chain project, has fallen below its long-term support level, and its on-chain stablecoin has decreased by about $300 million in the past week. FARTCOIN, a meme coin on a certain public chain, has surged several times against the backdrop of a sluggish overall market, becoming the leader of this round of rebound. Additionally, BABY, as a representative staking project in the Bitcoin ecosystem, has returned to a market capitalization of about $800 million after its listing, a figure comparable to its last round of institutional investment valuation.

On-chain Data Analysis

The inflow of funds into the Bitcoin market has almost come to a standstill. Market liquidity is rapidly shrinking, causing the total market capitalization of altcoins to drop from 1 trillion dollars at the beginning of the year to around 600 billion dollars. This decline seems to have affected all sectors, showing a widespread characteristic.

Institutional funds have once again shown a slight net outflow, and panic sentiment is spreading across the global market. The market capitalization of stablecoins has also experienced a slight decline, reflecting a clear increase in investors' risk aversion.

From the long-term trend indicator MVRV-ZScore, the current value is 1.6, close to the bottom range. This indicator is based on the total market cost and reflects the overall profit situation. When the indicator is greater than 6, it is generally considered to be the market top range; when it is less than 2, it is viewed as the bottom range. Currently, MVRV has fallen below the critical level of 1, indicating that most holders are in a state of loss.

Futures market situation

The funding rate for this period remains at a relatively low level of around 0.00%. Generally, a rate between 0.05% and 0.1% indicates a higher long leverage, which may be a short-term topping signal; whereas a rate between -0.1% and 0% suggests a higher short leverage, which may be a short-term bottoming signal.

The open interest in Bitcoin futures continues to decline, indicating that major capital in the market is withdrawing. The long-short ratio for futures is 1.9, reflecting a market sentiment leaning towards greed. However, due to the significant fluctuations in the long-short ratio data, its reference value has weakened.

Spot market performance

This week, the price of Bitcoin has experienced severe fluctuations, while altcoins lack new investment narratives. The pressure on global financial markets continues to increase due to the growing uncertainty surrounding U.S. tariff policies. This weak trend has spread to almost all asset classes, and the cryptocurrency market, as a risk asset, has not been spared, remaining trapped in a bear market.