Wall Street bank Citi said that while the stock market has performed strongly, the cryptocurrency market has weakened again recently, and a sharp liquidation in October has dented investor confidence.
The sell-off has reduced the risk appetite of leveraged traders and new investors in spot ETFs, who have withdrawn their investments. Flows into US spot bitcoin ETFs have fallen sharply recently, undermining a key factor underpinning the market's bullish outlook.
Citi originally predicted that ETF funds would continue to flow in as financial advisers and others increased their exposure to bitcoin, but now the momentum has stalled and market sentiment may continue to be subdued.
The on-chain data also added to the cautious atmosphere. The number of large bitcoin holders fell, the number of small retail wallets rose, and funding rates fell, indicating that long-term investors may be selling, and the demand for leverage is also weakening. On a technical level, bitcoin fell below the 200-day moving average, or further suppressed demand. Citi also linked the weakness of bitcoin to the tightening of bank liquidity. The report concluded that the flow of spot ETF funds is a key signal to observe the turn of sentiment in the cryptocurrency market.
Citi: Cryptocurrency weakness stemmed from slowing ETF inflows and weakening risk appetite
2025-11-05 16:00:57
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