$80,000 Bitcoin: Recovery is Clear, but Bullish Conviction Remains Lacking

Original Author: Glassnode

Original Translation: AididiaoJP, Foresight News

Bitcoin has reclaimed the $80,000 level, with improvements in ETF inflows, spot demand, and positioning. However, relatively weak capital inflows and heavy overhead supply near $86,000 continue to keep market conviction below that of previous bull market phases.

Summary

• U.S. spot Bitcoin ETF inflows have turned decisively positive again, with institutional demand reigniting as Bitcoin recovers from the mid-$60,000s to the low $80,000s.
• Bitcoin's Relative Unrealized Loss peaked at 25% of market cap during the February sell-off, then compressed to 8% after reclaiming $80,000. This supports the view that if the $60,000 level holds, the current downturn remains a shallow bear market.
• The 30-day Net Position Change in Realized Cap has recovered to $2.8 billion per month, indicating improving capital inflows, though still far below the over $10 billion monthly levels seen during previous bull cycle expansions.
• The 30-day Cost Basis of $76,900 provides immediate short-term support, while the accumulation zone from November to February at $86,900 remains a key near-term resistance level for the recovery.
• Coinbase Spot Volume Delta has turned sharply positive over the past two weeks, indicating increasingly aggressive buyer activity and strengthening spot market demand.
• Hyperliquid traders have steadily rebuilt long exposure as prices rose, reflecting improved speculative sentiment and growing confidence in further upward continuation.
• Implied volatility continues to compress across the curve, led by the front end, while realized volatility trends lower, with the market pricing in a calmer short-term landscape.
• Skew compression suggests reduced demand for downside hedges, with the options structure around $80,000 becoming more balanced.
• Market maker positioning remains a key driver of short-term dynamics. A large negative Gamma cluster near $82,000 could still amplify price movements if spot re-enters that area.

Macro Insights

The macro backdrop remains a tug-of-war between slowing economic growth and persistent inflation. Recent U.S. inflation data came in stronger than expected, while the labor market has proven more resilient than many anticipated. Consequently, the market has pushed back expectations for rate cuts, with Treasury yields remaining elevated and financial conditions relatively tight.

Liquidity continues to be a key driver for risk assets. Equity markets are grinding higher slowly, but beneath the surface, conditions remain fragile as markets adapt to the reality of higher-for-longer interest rates. Meanwhile, strength in oil and commodities continues to fuel inflation expectations, particularly amid ongoing geopolitical tensions.

For digital assets, the picture remains constructive but selective. Despite tightening liquidity conditions and a strong U.S. dollar, Bitcoin has shown resilience, suggesting underlying demand remains intact. However, softer ETF inflows and high real yields imply that more sustained upside may require looser financial conditions or a new catalyst to rekindle broader risk appetite.

On-Chain Insights

From Fear to Uncertainty

Against the macro backdrop of sticky inflation, high Treasury yields, and tighter financial conditions, Bitcoin continues to demonstrate relative resilience, indicating that underlying demand remains intact even as the broader risk environment remains unsettled. To structurally assess the current cycle's position, Relative Unrealized Loss (which measures the total dollar value of unrealized losses held by all investors as a percentage of market cap) provides a precise cycle barometer. During the February flash crash, this metric peaked at 25% of market cap. While indicating significant stress, this reading remained far below the extreme levels recorded in previous bear cycles. After subsequently reclaiming $80,000, the metric has compressed to around 8%. This shift has moved prevailing sentiment from fear to uncertainty, rather than outright collapse.

If $60,000 proves to be the cycle low, this bear market would be the shallowest on record—recording fear but falling well short of the widespread washouts that historically mark durable cycle bottoms.

Scale of Capital Inflows

As sentiment shifts from fear to uncertainty, the key question is whether the current rally is a typical bear market bounce, or the early stage of a genuine bullish transition. The most direct measure is net capital inflow, specifically the 30-day Net Position Change in Realized Cap, which tracks the monthly change in total capital stored on-chain. With the recent rally to $82,000, this indicator has reached $2.8 billion per month. This positive reading explains the constructive momentum of recent weeks.

However, context is crucial: during the early phase of each major upswing in the 2023-2025 bull market, this metric rapidly accelerated from around $2 billion per month to over $10 billion. While encouraging, the current reading remains far below that threshold, suggesting the capital inflows underpinning this recovery lack the conviction seen at similar turning points in previous cycles.

Support and Resistance Through the Lens of Cost Basis

Despite a 37% rally from $60,000 to $82,000, capital inflows remain moderate and uncertainty persists. The Realized Price indicator, broken down by holding period, provides a granular framework for identifying the most immediate support and resistance levels. This model tracks the average acquisition price of coins grouped by holding period, mapping behavioral anchor points of different investor cohorts onto the price chart.

The current rally's momentum is primarily driven by the accumulation wave of the past 30 days. The cost basis for this cohort sits around $76,900, forming the most immediate support floor in the short term. Above, the cost basis for investors who accumulated during the market consolidation from November to February is concentrated near $86,900. As these holders approach breakeven and face increasing incentives to distribute, this represents the most likely near-term resistance zone.

Off-Chain Insights

Rebuilding ETF Demand

U.S. spot Bitcoin ETF inflows have turned decisively positive in recent weeks, with sustained inflows returning as Bitcoin reclaimed the $80,000 level. After months of shaky demand and significant outflows in Q1, this latest shift indicates that institutional demand is beginning to re-emerge in a more meaningful way.

Importantly, the recovery in ETF demand has been sustained rather than driven by a single surge in allocation, suggesting institutions are steadily accumulating as market conditions improve. Inflow intensity has also accelerated alongside price, reinforcing the view that traditional capital is once again supporting momentum rather than exiting during rallies.

The current structure shows significant market structure improvement compared to earlier this year. ETF inflows are now acting as a tailwind rather than a source of persistent selling pressure, removing one of the key headwinds that previously constrained recovery attempts. If sustained, continued institutional accumulation could provide Bitcoin with the demand base needed to challenge higher overhead supply zones in the coming weeks.

Coinbase Spot Buying Reaccelerates

Coinbase spot volume has turned sharply positive over the past two weeks, with aggressive buyer activity returning as Bitcoin reclaimed the low $80,000s. This latest shift stands in stark contrast to the persistent selling pressure that dominated most of Q1, when negative volume consistently reinforced downside momentum.

Importantly, the latest leg higher has been accompanied by repeated increases in positive spot buying volume, rather than isolated buying surges, indicating that sustained demand is beginning to absorb overhead supply. The strengthening activity on Coinbase is also highly consistent with the recovery in ETF inflows, suggesting that both U.S.-based and institutional buyers are re-engaging.

The current structure suggests spot demand is once again acting as a supporting force for price, rather than a source of distribution. Continued strength in Coinbase buyer flow, especially when rising in tandem with ETF inflows, indicates improving market conviction and healthier underlying demand conditions for the latest rally.

Hyperliquid Traders Turn Increasingly Bullish

Over the past few weeks, positioning on Hyperliquid has become increasingly skewed towards longs, with BTC net positioning steadily rising as Bitcoin recovered to the low $80,000s. This shift marks a significant reversal from the persistent bearish bias that dominated most of Q1, when the market retreated to the low $60,000s.

Importantly, the recent increase in long exposure has been a gradual development rather than a surge driven by a single crowded position, suggesting traders are steadily rebuilding directional bullish exposure as market conditions improve. Net positioning is now approaching the strongest bullish bias since late 2025, reflecting growing confidence in upward continuation.

The persistent long positioning alongside rising price action indicates improving trader sentiment and a more constructive speculative backdrop. However, increasingly crowded long exposure could make the market more sensitive to short-term volatility and liquidation-driven pullbacks.

Implied Volatility Declines

Over the past week, Bitcoin implied volatility has turned lower, with the front-month contract falling from 39% to 34.6%. Longer tenors have followed suit, with the curve declining by approximately 1 to 2 volatility points across all maturities.

This move reflects a broad repricing lower across the term structure, as traders reduce expectations for short-term realized volatility. The decline follows a recent volatility spike and coincides with more controlled spot action, reinforcing the view that the market is reverting to a calmer regime.

As implied volatility compresses, the cost of options decreases across tenors, particularly at the front end, which is most sensitive to short-term positioning and demand changes.

The current structure reflects reduced market pricing for large moves ahead, with volatility supply continuing to outpace demand across the curve.

Volatility Risk Premium Remains Positive

While implied volatility continues to compress across the curve, realized volatility is declining even faster. Bitcoin's 30-day realized volatility currently stands at 30.48%, steadily declining over recent weeks as spot action remains relatively controlled.

Meanwhile, front-month implied volatility remains around 36.4%, meaning implied is still above realized and maintains a positive volatility risk premium. In other words, options continue to price in more volatility ahead than Bitcoin's recent spot moves have delivered.

The spread between implied and realized volatility has also been rebuilding over the past two to three weeks, recovering from a brief compression to parity in April to around 6 volatility points. This suggests that despite the overall downward volatility reset, options demand remains elevated relative to realized volatility.

Therefore, while overall volatility continues to soften on both the implied and realized dimensions, hedging conditions remain favorable for volatility sellers.

Skew Compression Indicates Reduced Downside Hedging Demand

As volatility expectations continue to reset lower, skew is also normalizing across the curve. This move is most pronounced at the front end, where the 1-week 25-delta skew has compressed from around -10% to -4% over the past week. Longer tenors have softened in tandem, with the 1-month, 3-month, and 6-month tenors all losing approximately 1 to 2 points of put premium.

Notably, this compression has occurred against the backdrop of Bitcoin consolidating around the $80,000 range and a supportive macro backdrop that remains relatively weak. The options surface does not show increased demand for downside protection; instead, it continues to reprice towards a more balanced structure.

This upward move reflects a steady reduction in the premium of put options relative to call options, indicating that demand for downside protection across the curve is gradually waning rather than intensifying.

While skew remains in bearish territory across tenors, the continued compression suggests that demand for downside hedges is gradually easing rather than intensifying.

Market Maker Gamma Keeps Spot Sensitive Around $82,000

Market maker positioning continues to create a reactive structure around the current price level. The largest concentration of negative Gamma sits at the $82,000 strike price, with an exposure of approximately $2.6 billion. Meanwhile, positive Gamma accumulates near $85,000, close to $1.8 billion.

As spot remains below the negative Gamma cluster at $82,000, a price re-entry into that zone could trigger reactive market maker hedging flows, reinforcing momentum and amplifying price action. Higher up, the positive Gamma concentration near $85,000 could act to suppress volatility.

Flows also reflect the shift in positioning. Over the past 7 days, put buying accounted for 71% of premium flow, reflecting high demand for downside protection during the recent consolidation. In the last 24 hours, 58% of flow came from put selling, suggesting some of those hedges are being unwound.

This structure leaves the market increasingly sensitive to amplified hedging flows if spot re-enters the large negative Gamma cluster near $82,000.

Conclusion

In summary, Bitcoin's recovery continues to strengthen beneath the surface, with spot-led demand, rekindled ETF inflows, and improved speculative positioning collectively contributing to a more constructive market structure. The sharp compression in Relative Unrealized Loss, along with the stabilization of key on-chain profitability and liquidity metrics, increasingly suggests that the February decline is viewed as a cyclical reset rather than the start of a deeper bear market.

At the same time, the character of this rally differs markedly from the aggressive expansions seen during the 2023-2025 period. Capital inflows are recovering but remain far below the thresholds of previous breakouts, while volatility compression and calmer derivatives positioning point to a market gradually rebuilding confidence rather than entering a phase of euphoria. This makes the current advance appear more like a structurally-supported recovery than a fully confirmed momentum breakout.

With Bitcoin now re-entering a dense zone of overhead supply between $82,000 and $87,000, the market is moving into a territory where price discovery becomes increasingly important. Sustaining a hold above this zone will likely require stronger spot participation and deeper capital rotation to absorb the remaining overhead supply. Until then, the broader structure continues to improve, but conviction appears to be rebuilding rather than fully restored.