Market Stabilization Amidst Underlying Weakness
Bitcoin's Relative Strength Index (RSI) is showing signs of recovery from oversold levels, and the spot Cumulative Volume Delta (CVD) has turned positive, indicating an early stabilization in market sentiment. Exchange-Traded Funds (ETFs) have registered inflows totaling $159.8 million, suggesting a renewed, albeit cautious, institutional interest. However, persistent low trading volumes and a de-risking trend in futures markets point to continued caution among investors.
Spot Markets Show Selective Strength
Spot markets are experiencing a notable shift, with the Cumulative Volume Delta (CVD) turning positive for the first time in several weeks. This indicates aggressive accumulation, even as spot trading volumes have compressed to near historic lows. This suggests a pattern of cautious, selective participation rather than widespread market enthusiasm. Exchange-Traded Funds (ETFs) have mirrored this positive trend, recording net inflows of $159.8 million following previous outflows, which hints at a rekindled institutional appetite. Despite these positive signs, trading volumes remain below the lower Bollinger Band, underscoring a lack of broad conviction in the current market conditions.
ETFs Revive—But With Cautious Inflows
In the derivatives market, futures are undergoing significant de-risking. Open Interest has fallen below its lower band, funding rates have reached cycle lows, and leverage is being unwound, aligning with a broader deleveraging trend. Options activity has also softened, with modest Open Interest growth and volatility pricing shifting to a discount, indicating an underpricing of future risks. The skew has eased, reducing bearish hedging. Meanwhile, on-chain fundamentals are lagging behind these developments. Network activity has cooled, with a decrease in active addresses and transfer volumes. Fee revenue has plummeted below the lower band, reflecting reduced network usage in a post-halving environment that is still grappling with miner economics.
Derivatives De-Risk as Leverage Flushes Out
Capital flows present a mixed picture. While the off-chain spot CVD is showing improvement, the Realized Cap Change indicator, which tracks the aggregate cost basis of all coins, is declining towards zero. This suggests muted fresh inflows and a reliance on the churn of existing supply. Profitability metrics remain predominantly in loss-dominant territory. The ratios of short-term holders (STHs) to long-term holders (LTHs) and the Hot Capital Share are elevated above their upper bands, pointing to speculative and reactive behavior rather than strong, long-term conviction. MVRV ratios are holding stable within profit zones, which curbs immediate distribution risks but has not yet ignited bullish momentum.
Outlook for December 2025
This fragile equilibrium positions Bitcoin at a critical juncture for December 2025. Oversold conditions are beginning to ease, ETF inflows could potentially catalyze further upside, and de-risked derivatives markets may offer a cleaner launchpad for recovery. However, with liquidity remaining thin, on-chain activity persistently subdued, and short-term capital dominating market movements, any sustained rally will require a significant increase in spot demand and broader investor participation. As Glassnode observes, market conviction remains unproven. Investors are advised to closely monitor the resurgence of trading volumes and the momentum of ETF inflows, lest the current recovery prove to be a temporary bounce in a macroeconomic landscape influenced by regulatory uncertainties and global interest rate fluctuations.