Hello readers,

Year-to-date, both Gold and the S&P 500 are now outperforming BTC. Yet, all of the seemingly “bullish catalysts” heading into year-end remain in place.

Rate cuts. Regulation. Stablecoins. Tokenization. Liquidity. Trade Agreements. GDP. Mag 7 Earnings. Big Beautiful Bill. Trump.

The setup looks good on paper. Still, crypto market participants seem to be frozen between hope and disbelief as sentiment and fundamentals begin to erode.

In this week’s report, we seek to cut through the noise with hard data and observations on market sentiment.

Disclaimer: Views expressed are the author’s personal views and should not be relied upon as investment advice.

The DeFi Report is powered by BIT Digital, the leading global platform for high-performance computing infrastructure and one of the largest ETH Treasury firms. NASDAQ: BTBT

Let’s go.

Momentum Data

Moving Averages

Data: The DeFi Report, as of 11.4.25

BTC, ETH, and SOL have all lost their 50, 100, and 200-day SMA. The key number we are watching is $102.8k for BTC (its 50-week moving average). Why? In past cycles, when BTC had multiple weekly closes below the 50-week moving average, the cycle top was in.

BTC’s longer 200-week moving average is currently $54.7k. We expect the BTC price to ultimately converge toward the 200-week moving average (which will continue to rise) at the bottom of the bear market, if that is where we are heading.

TDR Pro members will be notified when this occurs (and when additional “fair value” targets are hit).

Relative Strength

Data: The DeFi Report, as of 11.4.25. RSI = 14 period.

BTC, ETH, and SOL are all approaching “oversold” levels (below 30). Longer tail altcoins are already oversold.

In a bull market, this is typically a green light to “buy the dip.”

More on this in the Portfolio Management section below.

Flows Data

ETFs

Data: Glassnode, as of 11.4.25

In terms of net flows and AUM, the Bitcoin ETFs have been among the most successful financial products in history.

However, since October 10th, the ETFs have seen $1.4b of net outflows. But it’s not the size of the outflows that concerns us. It’s the lack of inflows.

As demand wanes, Bitcoin’s largest accumulator appears to be running low on dry powder…

Microstrategy Purchases

Data: High Charts, as of 11.4.25

MicroStrategy currently holds over 641k BTC. They purchased 476k BTC from Oct’ 23 through July ‘25.

That’s 1.19x the total BTC issuance over the same period.

Over the last three months? They’ve purchased just 12.2k BTC.

For reference, MicroStrategy has 12x the BTC holdings of the second-largest BTC Treasury firm. They make up roughly 65% of the “Treasury” market.

With ETF demand waning and the largest BTC holder seemingly “tapped out” in the near-term, what do we see from the Long-Term Holder cohort onchain?

Holder Cohort Data

Long Term Holders

Data: Glassnode, as of 11.4.25

More selling. This is the 3rd distribution wave of the cycle.

Historically, market expansions begin only after long-term holders transition from distribution to sustained accumulation. We’ve seen this play out twice in this cycle.

However, if we are heading into a bear market, we can see that it took 10 months for the BTC price to officially bottom after long-term holders became net accumulators after the ‘17 cycle peak.

Similarly, it took 9.5 months for the BTC price to officially bottom after long-term holders returned to the market after the first ‘21 cycle peak.

TDR Pro members will be notified when we see this shift occur in the coming quarters (and when our “fair value” targets are hit).

Short Term Holders

Data: Glassnode, as of 11.4.25

As long-term holders exit the market, they’ve passed their coins to a new wave of short-term holders.

We think long-term holders will step back into the market when this cohort ultimately capitulates and sends their coins back to where they came from (with some becoming long-term holders).

Sentiment

As noted in the intro, it’s our sense that a significant part of the market is still holding out hope.

Rate cuts. Regulation. Stablecoins. Tokenization. Liquidity. Trade Agreements. GDP. Mag 7 Earnings. Big Beautiful Bill. Trump.

These factors have led many to conclude that the 4-year cycle is a “thing of the past.”

Now. BTC has been in an up-only trend since January ‘23. Buying every dip has been the correct move. Therefore, it’s not surprising that many market participants may have a hard time shifting out of a more bullish stance. After all, the narratives are all in place.

Our views on market structure/sentiment were reinforced by the market’s reaction to a recent well-written piece by Jordi Visser titled “Bitcoin’s Silent IPO: Why This Consolidation Isn’t What You Think.”

Via X

The post I snarkily quote-tweeted had a link to the piece. It got 2.6 million impressions. The piece? It’s a story about how Bitcoin’s recent consolidation is akin to a “silent IPO.” Just OGs getting out. Setting a new base. Written from the perspective of “I’ve seen this before, there’s nothing to worry about. Just accumulate.”

Despite being a “feel-good story,” rather than a data-driven analysis, the market ate it up. Almost like investors just needed some therapy.

This revealed a lot about the current market structure.

The takeaway? There is still a lot of hopium out there. Investors want to “feel good.” This piece accomplished that, and that’s probably why it went viral. Who knows, maybe it will be validated. But the response definitely caught my eye.

Closing Thoughts & Portfolio Management

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