BTCs summer consolidation phase may be coming to an end, and BTC prices may enter a new round of rising range as they test key breakthrough resistance levels. BTCs actual volatility has dropped to a low point in recent years, and the weekly implied volatility is only around 30%. The downward trend in volatility not only reflects the increasingly mature market structure, but also opens up room for participation for institutional investors with marginalized risk preferences.
BTC spot ETF has strong capital inflows, and the increase in market value requires more capital support
BTC ETF inflows have been unexpectedly resilient. Since April, about $14 billion has flowed into BTC spot ETFs, about $4 billion higher than the corresponding inflow at the spot price. This part of real demand is highly sticky, with almost no obvious signs of short-term speculation. BTC is increasingly seen as a long-term allocation asset rather than a short-term trading tool.
While BTC funds are flowing in, the capital efficiency of the overall crypto market is declining. The scale of fund inflows so far in 2025 is expected to be lower than the peak of $377 billion in 2024, and is about $291 billion after annualization based on the current trend. The capital density required to push up the market value of BTC is much higher than before. With a market value increase of 2.0 to 2.6 times for every $1 invested, maintaining the upward trend of prices is becoming increasingly dependent on capital support. Therefore, although BTC has continued to receive strong ETF fund inflows in the near future, coupled with the continued increase in company treasury funds, the price is still fluctuating and consolidating in a range.
Wall Streets strong participation may provide sufficient momentum for BTC price increases
Data shows that there are currently more than $100 billion of crypto-related IPOs in the preparation stage. Circle has taken the lead in listing and its performance has far exceeded market expectations. Compared with crypto-native assets, crypto-concept stocks provide institutional investors with a more familiar investment allocation path with leverage, and the attribute of technological innovation makes the narrative level more grand.
Entering a historically strong month, BTC price has a chance to hit $120,000
July is usually a relatively strong month for BTC. Historical data shows that there have been seven increases in the past decade, with an average increase of 9.1%. In contrast, the market performance in August and September was generally weak due to the decline in market activity and the increase in macro uncertainty. If the seasonal attributes continue, BTC prices may usher in a wave of highs in the next few weeks, and then re-enter seasonal consolidation.
The current Feds attitude has turned moderate, and the overall US stock earnings report is positive. Combined with the recovery of market sentiment after the July 4 holiday, the three together provide a temporary external support for the BTC price. However, if the overall net inflow fails to rebound significantly, especially without the drive from retail investors or new funds, it is not ruled out that the rebound will be blocked at $116,000. In an ideal state, the BTC price may reach $120,000.
The market greed and fear index indirectly verifies the above assumption. At present, the smooth moving average of the greed/fear index has shown signs of bottoming out and is expected to move towards the greed zone. Therefore, if BTC continues its seasonal strength in July, the relatively conservative summer adjustment may face correction.
Disclaimer: The market is risky and investment should be cautious. This article does not constitute investment advice. Digital asset trading can be extremely risky and unstable. Investment decisions should be made after carefully considering personal circumstances and consulting financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.
