Bitcoin Faces 7% Drop in Futures Open Interest as On-Chain Activity Declines 32%

Bitcoin has recently returned to its familiar price range, bouncing back to $106,000 after a dip to just under $99,000 last weekend. This price movement has given bulls some hope, but underlying on-chain data suggests that there are deeper issues at play. According to analytics firm Glassnode, both spot and futures markets are showing signs of fatigue, which could potentially cause Bitcoin's price to retest the $99,000 level.

Despite multiple price swings in recent days, Bitcoin has managed to stay within the $100,000 to $110,000 range, which has been the market structure since early May. The Cumulative Volume Delta (CVD) Heatmap shows strong accumulation between $93,000 and $100,000, which has acted as a buffer zone during recent geopolitical volatility. However, market volume indicates that this support may soon face additional pressure.

Investor profitability and engagement surrounding Bitcoin are rapidly cooling. A third major wave of profit-taking is causing the 30-day realized profit average to taper, and on-chain activity has decreased significantly. The 7-day moving average of on-chain transfer volume has dropped by about 32%, from a peak of $76 billion in late May to $52 billion over the recent weekend. Current spot volume trading, which is now at just $7.7 billion, is far below the volumes seen during previous rallies. The lack of strong buying enthusiasm on the spot market shows that bullish sentiment has been replaced by caution, increasing the risk of a breakdown below $99,000 unless another wave of demand re-enters the market.

The slowdown in sentiment is not limited to the spot market. Although Bitcoin is attracting interest on derivatives exchanges, there are clear signs that futures sentiment is waning. Open interest dropped by 7% over the weekend, from 360,000 BTC to 334,000 BTC, and funding rates have been declining steadily since Bitcoin hit its Q1 2025 all-time high. Futures market participants had been very active through Bitcoin’s climb to $111,800 in May, but their conviction appears to be fading now. A further indication of a growing reluctance to hold long positions is the sharp decline in both the annualized funding rate and the 3-month rolling basis.

Without stronger directional conviction, the futures markets may not provide the upside needed to push Bitcoin to new highs. This situation may instead contribute to additional downward pressure. So far, Bitcoin has respected the $93,000 to $100,000 support zone, which was heavily accumulated during the Q1 2025 top formation. However, with low spot volumes, on-chain activity slowing, and fading futures sentiment, this support could become tested again. If market participants with a cost basis in this zone begin to sell, the resulting pressure could drag Bitcoin below $99,000 again next week.

At the time of writing, Bitcoin is trading at $107,100. The current market conditions suggest that Bitcoin's price could face additional downward pressure in the near future, potentially retesting the $99,000 level. The lack of strong buying enthusiasm and the cooling of investor profitability and engagement are contributing factors to this potential price movement. Unless another wave of demand re-enters the market, the risk of a breakdown below $99,000 grows. The futures market is also showing signs of waning sentiment, with open interest and funding rates declining. Without stronger directional conviction, the futures markets may not provide the upside needed to push Bitcoin to new highs, potentially contributing to additional downward pressure.