The Bitcoin market is at a critical juncture as the exchange-traded funds (ETFs) directly tied to its price enter a slowdown phase after a period of strong inflows. This shift in momentum has ignited a fierce debate among investors and analysts, with bears (investors who expect prices to fall) eyeing the potential for a significant correction.
After a spectacular launch, where spot Bitcoin ETFs attracted $12.5 billion in net inflows during their first three months, being hailed as "the most successful ETF launch in history," capital flows have now cooled. Net inflows fell 54% to $931.4 million last week from $2.03 billion the week prior. This slowdown suggests a "pause in institutional demand," according to on-chain data provider Glassnode.
This development has led some analysts to predict a deeper correction. With demand waning, some analysts are predicting a potential drop toward $90,000. A drop below key technical levels, such as the 21-week moving average, could signal a more challenging correction phase. The conversation around bearish targets includes price levels from $70,000 to $100,000.
However, not everyone shares this bearish outlook. Analysts at Bernstein are not worried about the slowdown, viewing it as a "short-term pause" before Bitcoin resumes its bull run. They maintain their price target of $150,000 by the end of 2025. This view is predicated on the belief that the next major wave of institutional capital has yet to enter the market. According to Michael Zhao of Grayscale Investments, the money that has come in so far was from self-directed retail investors, while serious institutional players are still conducting due diligence.
The market appears to be in a holding pattern, balancing short-term bearish pressures against long-term bullish prospects. Bitcoin's ability to hold above key support levels, such as $113,000, is seen as critical. The future trajectory will largely depend on whether institutional inflows rebound and if macroeconomic conditions remain favorable for risk assets.