Behind the Market Calm

DAILY MARKET OVERVIEW

Market Sideways, But for how Long?

 👋 Hey Crypto Enthusiasts! The Crypto market has been fairly calm over the weekend and today, let’s explore why!

The crypto market continues to trade in a sideways range, extending the trend from the weekend. With U.S. stock markets closed for President’s Day, there has been little movement in risk assets. However, market activity is expected to pick up tomorrow once traditional markets reopen.

One of the key factors influencing price action is ongoing uncertainty around interest rate cuts. The Federal Reserve has maintained a cautious stance, keeping investors on edge.

📉 Crypto Investment Funds See $415M in Outflows

For the first time in five weeks, global crypto investment products experienced net outflows. A total of $415 million was withdrawn from funds managed by firms such as BlackRock, Bitwise, Fidelity, and Grayscale.

Key Reasons for Outflows:

• Federal Reserve’s hawkish stance: Fed Chair Jerome Powell signaled that rate cuts may be delayed, reducing appetite for risk assets.

• Inflation concerns: The latest CPI data came in higher than expected, reinforcing fears of persistent inflation.

• U.S. Bitcoin ETFs see large redemptions: Over $580 million was withdrawn from spot Bitcoin ETFs last week, contributing to the decline.

Despite these outflows, analysts note that there has been no significant increase in short positions against Bitcoin, suggesting that investors remain cautious rather than outright bearish.

🐂 Bernstein Predicts the Next Phase of Bitcoin’s Bull Market

While short-term sentiment appears mixed, Bernstein analysts believe Bitcoin is preparing for another major upward move. Their report highlights several catalysts that could drive the next phase of growth:

• National Bitcoin Reserve: The U.S. Crypto Task Force is exploring a government-held Bitcoin reserve.
  

• Sovereign Wealth Fund Investments: The Trump administration may include crypto firms in a Sovereign Wealth Fund.
  

• Institutional Adoption:

  • Mubadala invested $437M in Bitcoin ETFs.

  • MicroStrategy added $742M in BTC.

  • Goldman Sachs & Barclays increased exposure.
    

• Regulatory Shift: The SEC repealed SAB 121, allowing banks to custody crypto.

💲 FTX to Begin Repaying Customers – Will the Funds Reenter Crypto?

Starting February 18, FTX will begin repaying between $6.5 billion and $7 billion to former customers. The question now is whether these funds will be reinvested into crypto markets or cashed out.

Some investors expect a portion of these funds to flow back into Bitcoin and Ethereum, which could provide a temporary boost to prices. However, given the uncertain macroeconomic environment, others may choose to withdraw/sell and stay on the sidelines.

Market Outlook

• Crypto remains range-bound as investors await further clarity on interest rates and macroeconomic policy.

• Institutional adoption is growing, with sovereign wealth funds and major financial institutions increasing their exposure.

• FTX repayments could add liquidity to the market but may also lead to sell pressure, depending on how recipients react.

• Tomorrow’s reopening of U.S. stock markets will likely bring more volatility and direction to the market.

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SOCIAL SENTIMENT

Solana Faces Backlash Over Meme Coin Scams

Recent developments in the Solana ecosystem have sparked frustration among traders, leading to a decline in Solana-based meme coins and DeFi projects.

This shift follows a controversial meme coin launch linked to Argentina’s President, Javier Milei.

The LIBRA Token Controversy

• The LIBRA token was promoted as a way to support Argentina’s development and quickly reached a $4.5 billion fully diluted valuation.

• However, it was soon discovered that 95% of the supply was controlled by insiders and the project’s team.

• Insiders, including Kelsier Ventures, sold off their holdings, making an estimated $110 million before the token price collapsed.

• The token has now dropped to a $300 million valuation, and President Milei is facing fraud charges in Argentina.

Market Impact and Trader Reactions

• Solana’s price has declined by approximately 10% since the controversy, with many DeFi and meme tokens losing 20-40%.

• Ethereum and BNB have outperformed, as some traders move funds out of Solana’s ecosystem.

• The incident has renewed concerns about insider trading and the lack of oversight in Solana’s rapidly growing meme coin sector.

Community and Industry Responses

• Several influencers (KOLs) were paid to promote the token before launch, raising concerns about transparency.

• Dave Portnoy, who promoted the token, was refunded for his losses, adding to the controversy.

• Hayden Davis, the founder of Kelsier Ventures, admitted in an interview that the firm participated in insider buying and token sales.

• The Solana ecosystem has been a hub for high-risk speculative trading, but this event may lead to greater scrutiny and regulation.

Looking Ahead

• Solana may struggle to regain trader confidence in the short term, particularly in its meme coin sector.

• Ethereum and BNB chains could see an increase in trading activity as investors seek more stability.

• If further insider trading evidence emerges, it could impact trust in Solana’s broader DeFi space.

Final Takeaway

The recent LIBRA token collapse has intensified concerns about speculative excesses in Solana’s ecosystem. As Ethereum and Binance Smart Chain gain traction, it remains to be seen whether Solana can regain trust and stabilize.

NEWS OVERVIEW

The Latest Crypto Headlines 📰 

Coinbase Becomes Official Crypto Partner of Aston Martin F1
Coinbase signs a USDC-based sponsorship deal with Aston Martin's Formula One team, challenging Crypto.com’s long-term F1 partnership.

CalSTRS Pension Fund Doubles Value of MSTR Holdings
California’s teacher pension fund reports $83M in MSTR shares, benefiting from Bitcoin’s surge and MicroStrategy’s growing crypto-focused strategy.

Argentina’s President Charged in $LIBRA Token Scandal
Javier Milei faces fraud charges over his involvement in the collapsed $LIBRA token project, with calls for impeachment intensifying.

Mubadala Invests $436M in BlackRock’s Bitcoin ETF
Abu Dhabi’s sovereign wealth fund becomes the seventh-largest holder of IBIT, reinforcing Bitcoin’s institutional adoption and UAE’s crypto-friendly stance.

YOUTUBE INFLUENCER SUMMARY

Summary From The Top Influencers 📷️ 

DataDash - Is The Bitcoin Bull Market Over? (17.02.2025 Summary)

Nicholas Merten from DataDash warns that Bitcoin’s bull market may be entering a corrective phase, driven by weakening price action, institutional slowdown, and macroeconomic uncertainties.

1. Bitcoin’s Technical Weakness

• Bitcoin has failed to break above the 21-day moving average, signaling exhaustion.

• The 100-day MA (~$90K) is key support, but if broken, the 200-day MA (~$80K–$85K) could be next.

• Bitcoin’s diminishing returns per cycle indicate that parabolic growth phases are becoming weaker.

2. Institutional Demand Slowing

• ETF inflows have turned negative, with a net outflow of 4,000 BTC in two weeks.

• MicroStrategy’s BTC purchases have slowed, raising concerns about long-term demand.

• Without strong inflows, Bitcoin may struggle to sustain new highs.

3. The End of Predictable Bitcoin Cycles

• The impact of the Bitcoin halving is declining, as over 20M BTC are already in circulation.

• Bitcoin’s price cycles are less predictable, with more gradual uptrends and corrections instead of boom-and-bust cycles.

• Future price expansion may require government or central bank Bitcoin adoption, which is unlikely in the near term.

4. Altcoins & Retail Liquidity Concerns

• Ethereum and Solana are struggling, showing no signs of strong recovery.

• Retail traders are losing liquidity due to meme coin speculation and scams, reducing buying pressure in the broader market.

• Altcoins remain in a long-term downtrend, with no clear sign of reversal.

Final Take

Merten predicts a Bitcoin correction of 50% rather than an extreme bear market. Crypto’s cyclical nature is changing, and longer, more stable trends may replace the historic boom-bust cycles.

🔍 Bitcoin’s bull market is slowing, with weaker institutional demand and retail exhaustion. If $90K fails, watch $80K–$85K, and worst case, $50K.

Benjamin Cowen - Bitcoin: Bull Market Support Band (17.02.2025 Summary)

Benjamin Cowen focuses on Bitcoin’s market structure, the importance of key support levels, and why altcoins are struggling to gain momentum.

1. Bitcoin’s Bull Market Support Band ($90K) is Critical

• Bitcoin has been moving sideways since November, allowing the 20-week and 21-week moving averages to catch up.

• $90K is the first major support—if lost, Bitcoin could retest 2024 highs (~$74K).

• Daily closes below the 100-day MA suggest weakening momentum, making a correction more likely.

2. Altcoin Market Weakness

• Altcoins have been bleeding against Bitcoin since 2021, with no confirmed trend reversal.

• Ethereum remains well below its all-time high, showing continued underperformance.

• Meme coins have dropped 80%+ in a month, highlighting speculative exhaustion.

3. The Risk of a Left-Translated Cycle

• If Bitcoin fails to hold $90K, there’s a risk of an early market peak

• However, as long as Bitcoin remains above $74K, the macro uptrend is intact.

• A strong ETF-driven Bitcoin cycle may delay altseason further.

4. Why Sentiment Feels Bad Despite High Bitcoin Prices

• Most traders hold altcoins, not Bitcoin, which have underperformed.

• Meme coin crashes and lack of altcoin breakouts have created pessimism, even with Bitcoin near all-time highs.

• Altseason usually comes after max despair, meaning further altcoin bleeding may be necessary before recovery.

Final Take

Bitcoin remains the strongest asset in crypto, while altcoins are still in a prolonged bear market against BTC. If $90K holds, Bitcoin remains bullish—if it fails, a deeper correction is possible.

🔥 Altseason won’t start until altcoins bottom further. Bitcoin dominance is likely to increase before any reversal.

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