Bitcoin (BTC) Undergoes Its Second-Largest Correction of This Bull Run, Retracting 30% From Its All-Time High

Bitcoin (BTC) has undergone its second-largest correction of this bull run, according to analysts at crypto exchange Bitfinex. The correction, from the coin's all-time high of $109,590

Bitcoin (BTC) has suffered its second-largest correction of the current bull run, with analysts at crypto exchange Bitfinex attributing the downturn to short-term holders.

In its weekly report, Bitfinex points out that short-term holders, defined as those who bought within the last seven to 30 days, have suffered net unrealized losses and are often more subject to capitulation.

The report notes that over the week of March 9-15, there was a large-scale reduction in short-term holder capital, triggering a 30 percent correction from Bitcoin’s all-time high of $109,590, which was set on Jan. 20, to a low of $77,041.

Bitcoin capital flow by short-term holders. Source: Glassnode/Bitfinex

The correction, however, saw a rebound of 9.5 percent as Bitcoin rose to trade at around $84,357 by press time.

According to Bitfinex, a key factor to watch will be whether institutional demand picks up at these lower levels, potentially leading to supply absorption and price stabilization.

“While institutional flows and the macro situation is pivotal for market direction in the mid-term, statistically, a 30 percent drawdown has often marked the low before continuation higher,” Bitfinex analysts told Cointelegraph. “If Bitcoin stabilizes around this level, history suggests a strong recovery could follow.”

Bitcoin ETPs see $5.4B in outflows over five weeks

Weekly outflows from crypto exchange-traded products (ETPs) have reached a streak of five weeks, totaling $6.4 billion as of March 14. According to data from CoinShares, Bitcoin ETPs have borne the brunt of outflows, with $5.4 billion in losses.

The current macroeconomic climate may be weighing on the markets, according to Bitfinex. US consumer confidence has fallen to its lowest level in two years, and there are expectations of higher inflation along with economic uncertainty. On March 4, a Federal Reserve’s model predicted that the US economy would shrink by 2.8 percent in the first quarter of 2025.

Meanwhile, talks of trade wars continue to dominate the news, putting Bitcoin’s status as a safe-haven asset in doubt, keeping miners on their toes, and perhaps putting the bull market in peril — despite the White House’s recent announcement of a US Bitcoin strategic reserve and digital asset stockpile.