Bitcoin [BTC] has entered one of the most bearish phases in recent months as liquidity continues to drain from the market.
About $1.163 trillion has been wiped from Bitcoin’s market cap since October’s peak of $2.515 trillion, and sentiment remains significantly depressed.
Market analyzes show that institutional investors have largely stepped aside, leaving private participants to shoulder much of the current demand burden.
Investors remain underwater
Institutional investors – especially US-based participants – have shown a clear disinterest in Bitcoin since the beginning of the year.
The Coinbase Premium Index, which serves as a proxy for US institutional demand, has remained largely negative so far in 2026.
This trend confirms that, compared to global markets, US investors have distributed rather than accumulated. The premium is currently -0.04.
Source: CryptoQuant
The index measures the price difference between Bitcoin on Coinbase and BinanceThe world’s largest crypto exchange by trading volume.
A negative outcome indicates weaker demand from US investors compared to offshore markets.
US Bitcoin exchange-traded funds (ETFs) provide a clearer picture of this selling pressure in dollar terms.
NetFlow data shows that approximately $2.81 billion worth of Bitcoin has disappeared from these funds over the past two months. Of that total, $1.60 billion remained in January, while $1.21 billion flowed out in February.
The retail industry could prepare itself
Analysis of activity on Binance reveals a pattern that indicates the potential for stabilization, although it does not eliminate ongoing selling pressure.
The Binance Buying Power Index tracks the relative strength of stablecoin inflows versus Bitcoin outflows on the platform. Over the past 90 days, the index has fallen sharply to an all-time low of -0.07.
This level is notable because the last time the index reached -0.07 was in July 2024, when Bitcoin was worth almost $63,000. Bitcoin is currently trading around the same price level.
Source: CryptoQuant
When the index reached this level in mid-2024, the price consolidated for about three months before rising sharply in October, eventually peaking near $106,000.
Given Binance’s high liquidity and strong retail participation, the responsibility for maintaining demand may now largely fall on smaller investors.
However, while current conditions reflect aspects of the 2024 situation, history also shows that deeper declines are possible.
In both 2022 and 2023, the 90-day purchasing power index fell to an extreme low, causing prices to fall before a meaningful recovery began.
At this stage, measuring the strength and consistency of retail participation could be critical in determining the next change in direction.
What’s happening in the broader market
The spot market often provides the clearest view of cross-exchange activity, especially because it records retail flows.
Spot exchange mains power facts by MintGlass indicates that recent activity has tilted somewhat towards net purchases, although the magnitude remains modest.
Net spot buying over the past three days totals just $305 million – one of the weakest demand figures in recent months. This suggests that while buyers remain active, their conviction and capital commitment remain limited.
A shift in average daily demand from roughly $100 million to closer to $300 million would significantly strengthen recovery prospects.
Until such an expansion of spot market demand occurs, Bitcoin’s price action will likely remain fragile and highly sensitive to further institutional outflows.
Final summary
- Institutional investors exited the market with capital outflows of $2.81 billion in two months.
- Retail remains the main source of hope, but average daily spot demand has fallen to around $100 million over the past three days.