Despite a Wave of Capital Outflows Sweeping the Crypto Market

Despite a wave of capital outflows sweeping the crypto market, Bitcoin broke past $88,000, defying bearish expectations. Crypto analyst Ali Martinez has reported

Capital outflows continued to plague the crypto market as a whole despite Bitcoin’s surprising price action. Crypto analyst Ali Martinez reported that big money was withdrawn from the market for four days in a row.

About $630 million in capital outflows

According to Martinez’s analysis, a total of $3.6 billion was withdrawn from the market between April 17 and 20. The outflows come as traders grew increasingly conservative and decided to take some profits off the table. However, even with these massive outflows, Bitcoin’s rally remained largely undeterred.

The capital outflows come as no surprise given the recent market trends. After a strong start to the year, the crypto market began to show signs of weakness in mid-April. This was due in part to a macroeconomic environment that grew increasingly risk-off with every passing day. As the US dollar dropped significantly and gold price hit $3,500, investors were forced to seek safety in other markets.

This also came as equities started to decline with rising trade tensions between the US and its partners. The current unstable atmosphere created by new tariffs and failed negotiations with China and Japan made traditional markets unpredictable and uncertain.

The outflows also come as the Fear and Greed Index rose to 47, the highest score since late March. This change in investor sentiment could lead to even greater strength in the market, especially when combined with macroeconomic fundamentals.

Liquidations continue in the market

The new price levels come after Bitcoin rose by 1.16% within the past 24 hours while experiencing enormous trader liquidations. As Coinglass reports, more than 104,000 traders were wiped out in a single day with a total loss of $265.85m.

Long positions suffered the biggest blow, from which $145.88 million were eroded, while the shorts incurred losses of $119.98 million. Bitcoin posted the highest liquidation figures of $87.3 million, with Ether taking second place with $68.87 million.

The liquidations come as major holders are returning to the market. According to Glassnode, Bitcoin wallets with over 1,000 BTC rose to a four-month high. These levels were last witnessed in the immediate aftermath of Donald Trump’s win in November 2024.

This rally comes amid rising trust in Bitcoin as being an inflation hedge. Bitget Research further noted that the exchange between Bitcoin and gold has favorable indications of its safe-haven status. BitMEX co-founder Arthur Hayes proposed this to be the last chance to purchase BTC below 100k, citing buyback of the US Treasury bonds as the source of the upcoming liquidity boost.