KEYTAKEAWAYS
- Risk aversion drives Bitcoin dip, traders buy the dip
- Bitcoin ETF net outflows hit $1.649 billion
- MicroStrategy’s Bitcoin premium drops to 1.6x
CONTENT
RISK AVERSION SENTIMENT LEADS TO BITCOIN DECLINE, TRADERS BUYING THE DIP
On February 25, according to CoinDesk, Alexia Theodorou, Head of Derivatives at Kraken, stated that crypto traders are buying Bitcoin on Kraken as its price has fallen to a three-month low. Bitcoin has dropped below $88,000, while Nasdaq futures indicate that Wall Street’s risk-averse sentiment persists. As a safe-haven currency, the Japanese yen remains strong against the US dollar, along with growth-sensitive commodity currencies such as the Australian dollar.
ANALYSIS
Bitcoin’s pullback occurred against the backdrop of declining Nasdaq futures and strengthening safe-haven currencies (such as the Japanese yen). This indicates rising global market risk aversion, putting pressure on risk assets overall. In such circumstances, some traders may be undergoing deleveraging (reducing holdings of risky assets), leading to increased short-term selling pressure on Bitcoin.
BITCOIN ETF NET OUTFLOWS REACH $1.649 BILLION
On February 25, according to Farside Investors, the net outflow of Bitcoin ETFs has reached $1.649 billion since peaking on February 7, 2025.
ANALYSIS
Since the United States approved spot Bitcoin ETFs on January 11, the market experienced a strong inflow of funds, pushing Bitcoin prices higher. However, as Bitcoin reached higher price levels, investors’ demand for profit-taking increased, intensifying ETF outflows.
The recent decline in Nasdaq futures and the strengthening of safe-haven currencies such as the yen suggest rising market risk aversion. Some investors may be exiting high-risk assets, including Bitcoin ETFs.
MICROSTRATEGY’S MARKET VALUE PREMIUM RELATIVE TO BITCOIN HOLDINGS DROPS TO 1.6X
On February 25, according to data shared by cryptocurrency analyst Miles Deutscher, the premium of MicroStrategy’s market capitalization relative to its Bitcoin holdings has dropped from 3.4x in November last year to the current 1.6x.
ANALYSIS
MicroStrategy (MSTR) has long been considered a “shadow Bitcoin ETF” due to its primary asset being Bitcoin holdings and its continuous purchases of Bitcoin through financing. The company’s stock price typically trades at a significant premium relative to its BTC assets.
MicroStrategy acquires BTC through convertible bonds and debt financing, which, while amplifying returns, also increases financial risk. As the market adjusts, investors may begin reassessing the risks associated with this highly leveraged strategy, leading to a further contraction in the stock’s premium.
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