- Bitcoin is pulling back, but interestingly, there are no classic signs of overheating.
- Will speculative positioning continue to dominate the trend?
As Q2 draws to a close, Bitcoin [BTC] has posted a solid 30% quarterly return, marking a sharp acceleration from Q1’s 11.82% net loss.
Still, despite printing a new all-time high, BTC fell short of replicating Q4 2024’s explosive rally, when the asset nearly doubled and locked in a 47.73% ROI.
Sure, market FUD played a key role. However, a recent Glassnode report points to a more structural divergence — One with potential implications for how Bitcoin’s future rallies unfold.
BTC pulls back as leverage overtakes spot demand
No question, the post-Liberation FUD in early April shook the market, dragging Bitcoin down to $74,393, a multi-month low. But in hindsight, that move offered a prime entry for strategic buyers.
BTC rallied nearly 50% off that low, printing a new all-time high, but what stood out was the manner in which it happened.
There was no RSI blowout, no spike in retail-driven euphoria, and no signs of classic overheating in spot markets.
On the surface, this looked like a structurally healthy rally. But under the hood, Futures markets Open interest exploded to $81 billion, adding nearly $30 billion in under two months.
As a result, every Bitcoin dip triggered a spike in long liquidations, reinforcing a feedback loop.
Instead of orderly retracements, the market delivered aggressive unwinds, driven not by spot selling but by excessive leverage getting flushed.
Source: CryptoQuant
If this trend persists, liquidation patterns could soon resemble the late-January to early-April cycle, where leverage resets dictated Bitcoin’s every downside move.
It’s also worth noting that Q3 has historically underperformed, with Bitcoin posting minimal returns in the past three years.
Also add in the macro risks, and suddenly, that Futures-to-Spot Volume ratio becomes a critical lens.
Can Bitcoin lead when volume refuses to follow?
Glassnode data sheds light on why Bitcoin’s rally to $111k didn’t exhibit typical signs of market overheating.
Despite the new all-time high, spot volume remained muted at $7.7 billion, significantly below the peaks observed in prior bull cycles.
Source: Glassnode
Meanwhile, Futures volume kept climbing, pointing to a rally driven not by broad spot participation, but by speculative capital rotating through derivatives markets.
This structural imbalance reinforces AMBCrypto’s thesis: Leverage continues to drive Bitcoin’s price discovery this cycle, outpacing sustained retail demand.
That makes Bitcoin’s early Q3 feel a lot more fragile. And if traders keep piling into leverage, another Q1-style flush isn’t off the table.
