The Real Reason Behind Bitcoin's Sudden Strength

Bitcoin (CRYPTO: BTC) is holding near the $93,000 level following a weekend rally, as political developments in Venezuela lifted broader risk sentiment across markets.

What Happened: Bitcoin is entering early 2026 in a stabilization phase after its Q4 drawdown, consolidating between the low-$80,000s and mid-$90,000s.

Glassnode data shows momentum and liquidity conditions are improving:

• RSI is rebounding
• Spot selling pressure is easing
• Derivatives positioning is rebuilding in a more measured manner

Institutional interest has returned via positive U.S. spot Bitcoin ETF inflows, though this also introduces near-term profit-taking risk.

On-chain activity and holder profitability are gradually improving, but realized capital flows and long-term structural demand remain weak—leaving the market fragile and sensitive to volatility.

Derivatives data suggest a healthy reset rather than capitulation.

Futures open interest is rising slowly, while funding rates have cooled, indicating excessive bullish leverage has largely been flushed out.

Also Read: Wall Street Connects Bitcoin’s Rally To Falling Oil Prices—That’s Wrong, Bitwise Says

Why It Matters: Institutional participation is improving as U.S. spot ETF flows turn positive and trading volumes rise. On-chain signals remain mixed:

• Network activity is picking up, with more active addresses and higher transfer volumes
• Low transaction fees point to limited congestion
• Realized capital growth remains deeply negative, highlighting continued capital outflows and weak structural demand

Supply is increasingly concentrated among short-term holders, making price action more reactive to sentiment shifts.

The Bottom Line: Bitcoin appears to be transitioning out of a corrective phase into a fragile consolidation range.

While participation and institutional flows are improving, lingering structural weaknesses leave the market vulnerable to volatility and profit-taking.

Read Next:

• Regime Change In Venezuela—An Unexpected Tailwind For Bitcoin, Ethereum, XRP?

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