Bitcoin experienced a four-day crash last week, dropping from $115,000 to $104,000, marking a four-month low. Analysts see this correction as a healthy reset rather than the start of a broader market crash, prompting investors to shift from chasing gains to protecting capital. Short-term holder supply of Bitcoin has increased, indicating a rise in speculative capital taking a larger market share.

Open interest in Bitcoin fell by about 30%, signaling the market is less vulnerable to liquidation cascades. Glassnode reports a period of uncertainty in the cryptocurrency market cycle, with a $0.1M to $0.2M range posing challenges for those with weak conviction to HODL Bitcoin. Long-term holders continue selling to institutional investors, limiting Bitcoin’s upside potential.

Digital asset treasuries and ETFs have absorbed a significant amount of the long-term holder supply, affecting Bitcoin’s price potential. Political turmoil around President Trump’s tariff threats against China has impacted Bitcoin ETFs, resulting in $40 million worth of net outflows. The market is in a protection mode, prioritizing capital preservation over directional bets.

Read more at Cointelegraph: ‘Flush’, Not Crypto Cycle ‘Failure’