- Bitcoin's CME premium declined below 5%, indicating a shift toward bearish sentiment, according to K33 Research.
- BTC has shown a directionless movement since the presidential election, which suggests waning interest among investors.
- Strategy announced plans to issue $2 billion worth of senior convertible notes, which it aims to use partly for Bitcoin purchases.
Bitcoin (BTC) continued its downward trend on Tuesday as K33 Research's weekly report indicated growing declines in BTC CME premium and yields. Meanwhile, Strategy (formerly MicroStrategy) announced plans to issue $2 billion worth of senior convertible notes, which it intends to partly use for more Bitcoin purchases.
Bitcoin momentum appears lackluster, Strategy seeks to continue BTC buying spree
Bitcoin remains in a period of low volatility as yields, trading volumes and market fluctuations drop to their lowest levels in months, according to K33 Research.
"Bitcoin metrics are softening across all corners of the market. Volumes, yields, options premiums, and ETF flows have moved to areas not seen since before the election," K33 stated in its weekly report.
The report emphasized Bitcoin's initial upward rally following the presidential elections before facing lingering declines.
As of Thursday, Bitcoin's 30-day volatility fell to significant lows, with 37% of the top 100 U.S. companies now exhibiting higher price fluctuations — a dynamic not seen since October 2023.
The report suggests that traders are gearing up for downward volatility due to the change in "volatility regimes."
Bitcoin's CME futures premium has also dropped below 5%, which indicates that the market may be shifting toward a bearish phase. Notably, the premium has traded below the 5% range for only 65 days since January 2023.
"From 2023 to today, forward 30-day returns during such periods have outpaced returns in higher premium environments," the report stated. "However, from 2021 to 2025, low CME premiums have usually translated to weaker performance, largely influenced by the 2022 bear market."
Furthermore, yields in Bitcoin futures declined over the weekend, reaching lows last seen in September.
Despite Bitcoin's recent performance, business intelligence firm Strategy, formerly MicroStrategy, plans to raise an additional $2 billion through 0% senior convertible notes to acquire more Bitcoin.
According to an announcement on Tuesday, initial buyers of the notes can purchase up to an additional $300 million worth of notes within five business days of issuance.
The company also intends to use the net proceeds from the offering for Bitcoin purchases and general working capital.
The new offering shows that Strategy intends to continue its aggressive Bitcoin buying spree, as it did in the past few months.
The company currently holds 478,740 BTC and hopes to keep acquiring based on a 21/21 plan to raise $42 billion to buy Bitcoin over three years.
Bitcoin briefly dropped to $93,000 for the first time since early January before regaining $95,000 in the past 24 hours.
Bitcoin, altcoins, stablecoins FAQs
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
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