Key Takeaways:
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The Bitcoin long-to-short indicator on Binance hit a 30-day low, signaling a pointy decline in bullish leverage demand.
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U.S.-listed Bitcoin exchange-traded funds reversed a negative trend with net inflows of $516 million after a period of heavy liquidations.
Bitcoin (BTC) has fluctuated inside a good 8% range over the past 4 days, consolidating around $69,000 after an abrupt decline to $60,130 on Friday. Traders are currently grappling with the important thing triggers for this correction, especially because the S&P 500 stays near record highs and gold prices have risen 20% in two months.
The uncertainty following Bitcoin's 52% decline from its all-time high of $126,220 in October 2025 has likely created a highly skeptical attitude amongst top traders and fueled fears of further price declines.
The long-to-short positions of top Bitcoin traders on Binance and OKX. Source: Coinglass
Whales and market makers on Binance have been steadily reducing their bullish commitment since Wednesday. This shift is reflected within the long-to-short ratio, which fell from 1.93 to 1.20. This value represents a 30-day low for the exchange, suggesting that demand for leveraged long positions within the margin and futures markets has cooled despite BTC hitting a 15-month low.
Meanwhile, the long-to-short ratio for top traders on OKX reached 1.7 on Tuesday, a big reversal from its peak of 4.3 on Thursday. This transition is available in the context of a $1 billion liquidation event in leveraged bullish BTC futures, where market participants were forced to shut positions as a result of insufficient margin. Importantly, this specific data point reflects forced exits somewhat than a conscious directional bet on further downtrend.
Strong ETF demand suggests Bitcoin whales are still bullish
Demand for spot Bitcoin exchange-traded funds (ETFs) is powerful evidence that whales haven’t entered the bearish trend despite recent price weakness.
Bitcoin exchange-traded spot fund each day net inflows, USD. Source: CoinGlass
Since Friday, U.S.-listed Bitcoin ETFs have attracted $516 million in net inflows, reversing a trend from the last three trading days. As a result, the conditions that triggered the $2.2 billion in net outflows from Jan. 27 to Feb. 5 appear to have faded. A number one theory for this pressure pointed to an Asian fund that collapsed after making the most of ETF options positions via low-cost Japanese yen funding.
Franklin Bi, general partner at Pantera Capital, argued that a non-crypto-native trading firm was the most probably perpetrator. He noted that broader cross-asset margin unwinding coincided with sharp corrections in metals. For example, silver experienced a shocking 45% decline within the seven days ended February 5, wiping out two months of gains. However, official data still must be published to verify this theory.
The Bitcoin options market followed the same move, with an increase in neutral to bearish strategies on Thursday. After Bitcoin price fell below $72,000, traders pivoted somewhat than expect conditions to worsen.
Bitcoin Options Premium Volumes at Deribit, USD. Source: Laevitas.ch
The BTC options premium put-to-call ratio on Deribit rose to three.1 on Thursday, heavily favoring put (sell) instruments, although the indicator has since declined to 1.7. Overall, the last two weeks have been characterised by low demand for bullish positioning through BTC derivatives. While sentiment has deteriorated, lower leverage provides a healthier basis for sustained price increases once the tide turns.
It stays unclear what could shift investor perceptions back towards Bitcoin as core values reminiscent of censorship resistance and strict monetary policy remain unchanged. The weak demand for Bitcoin derivatives shouldn’t be interpreted as an absence of trust. Instead, it represents an increase in uncertainty until it becomes clear that exchanges and market makers were unaffected by the worth drop.
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