The cryptocurrency market experienced a significant pullback following the introduction of spot Bitcoin ETF listings, with the market value dropping from $1.82 trillion to $1.66 trillion. As Bitcoin’s dominance fell below 50%, altcoins like Ethereum began to recover.
Bitcoin’s price remained around $42,500 throughout the week, with investors anticipating accumulation below $40,000. However, experts suggest the short-term impact of the Bitcoin ETF approval has largely ended. The crypto market has been affected by factors such as volatility, earnings season, and macroeconomic conditions. A strong U.S. dollar has been exerting selling pressure on Bitcoin, with the U.S. dollar index (DXY) rebounding above 103.50 from early January’s level of 101.
Data from Coinglass and recent macro indicators show that the selling pressure on Bitcoin is easing. Over $100 million in liquidations occurred in the crypto market in the last 24 hours, with 75% of long positions and 25% of short positions liquidated. Bitcoin and Ethereum recorded liquidations of $22 million and $20 million, respectively. However, the trend is changing with increased open liquidity in the last 12 hours. Bitcoin’s volatility has hit a new low last month, with both the main futures RV and IV showing significant declines, and short-term IV dropping below 45%.
According to futures and option data, the short-term effect of the spot Bitcoin ETF has largely ended. Funding rates are looking attractive for investors, and buying is expected to begin soon. Bitcoin futures and options open interest (OI) have started to rise again in the last 4 hours. Open interest across exchanges like CME, Binance, and Coinbase is recovering, with the total Bitcoin futures open interest increasing by 0.35% to $18.31 billion.
In contrast, Ethereum’s open interest (OI) has decreased by over 2% in the last 24 hours, with the total ETH OI reaching $8.85 billion. However, open interest for Solana and XRP is on the rise, indicating potential price recoveries. Noted crypto analyst Crypto Birb suggests that Bitcoin’s risk-adjusted returns look promising for the next 12-18 months, and historical patterns could signal a significant rally if held through Bitcoin’s 4th halving and into 2026.