Macro conditions are shaping the crypto market movement.
First, news of the April 7 ceasefire reduced fears related to the Strait of Hormuz, which carries about 20% of global cargo flows. When oil fell below $100 and risk appetite improved, Bitcoin rose [BTC] rose above $72,200 while Ethereum [ETH] rose past $2,250 and both hit three-week highs.
At the same time, social dominance exceeded 1%, with volume rising towards 68, showing a growing focus on the “ending the war” narrative. Previously, a spike on March 30 showed similar optimism, but the price later weakened as talks collapsed, showing how fragile sentiment can be.
However, the latest move shows a stronger alignment between sentiment and price, indicating that macroeconomic relief is supporting demand. Yet this strength cannot last, as any setback in negotiations could reverse flows and put pressure on prices again.
Institutions drain stock market liquidity
Liquidity shifts often precede price movements. Binance held more than 90% of the market at the start of 2022, while Bitcoin traded between $40,000 and $50,000, indicating strong retail participation. By 2023, mounting macroeconomic pressures had reduced Binance’s dominance and Bitcoin had fallen to $20,000, signaling retail depletion and the start of capital rotation.
At the same time, larger players started withdrawing liquidity through OTC desks, reducing visible stock market activity. Institutions prefer OTC trading to avoid slippage and volatility in uncertain markets, especially as oil prices rose above $114 and risk sentiment weakened.
Looking ahead, the price recovered towards $90,000 in 2024-2025, but Binance’s dominance remained compressed between 20% and 40%, showing that retail did not return at the same pace. At the time of writing, dominance continued to decline, with 82% of the $32.7 billion in flows going off-exchange, strengthening institutional control.
Yet this shift works both ways, as reduced retail participation limits liquidity depth while stronger hands stabilize the price. In turn, Bitcoin’s structure looks more solid, although it relies more on concentrated capital than broad market participation.
Spot volumes are drying up as market activity freezes
As liquidity leaves the exchanges, spot activity begins to decline. Previously, large flows shifted to OTC, and their absence is now reflected in declining volumes. Binance, which peaked at over $330 billion in early 2024, is starting to lose steam as participation declines.
As tensions rose in late 2025, traders stepped back, not because opportunities disappeared, but because visibility diminished. This uncertainty makes it harder to price risk, causing both retailers and institutions to reduce exposure. In March, Binance posted just $69 billion, a level last seen in the 2023 bear phase.
The pattern applies at all locations. Gate.io fell almost 50%, while OKX, Coinbase and Bybit trended lower and showed a broad slowdown. The trend doesn’t just indicate a collapse, however, as lower volume often reflects holding behavior rather than a full exit.
In turn, lower activity reduces liquidity depth, which could amplify future moves once participation returns. This leaves the market poised between fragility and edification, with today’s inaction setting the stage for sharper responses tomorrow.
Final summary
- Bitcoin and Ethereum’s rallies reflect macroeconomic relief as sentiment rises above 1%, indicating fragile, event-driven demand.
- BTC is shifting towards institutional control, with 82% of the $32.7 billion in OTC flows and $69 billion in volumes indicating low participation and volatility risk.