Bitcoin Price Hits New ATH, but These Alarming Signs Point to $100K Crash

TLDR

Bitcoin price reached a new all-time high of $111,903 on May 21 on the Coinbase exchange. The rally attracted over $600 million in spot Bitcoin ETF inflows in the United States. Implied volatility remains at a 10-month low despite the new price highs. Open interest and the annualized basis on CME show limited institutional involvement. Daily active addresses and new wallet growth are declining while the price rises.

Bitcoin price bill surged on May 21, hitting a new all-time high of $111,903 on Coinbase. This price movement triggered $607.1 million in spot ETF inflows, showing strong buying interest. However, multiple indicators now signal that the Bitcoin price could fall to $100,000 in the short term.

Bitcoin Price Gains Meet Weak Volatility

Bitcoin price bills have been climbing, but the 30-day Bitcoin Implied Volatility Index sits at a 10-month low of 49.73. This divergence suggests market participants lack conviction in the sustainability of the recent upward move. While prices rise, sentiment indicators fail to reflect equal strength, indicating potential instability.

 

Volatility typically rises during strong trends, but this flatlining implies uncertainty around further upside. Aggressive directional bets may remain limited without rising implied volatility, creating an environment where pullbacks can accelerate quickly.

Bitcoin price bill gains, but low volatility levels show that options markets are not pricing in further significant movement. As a result, this disconnect could signal a short-term top. A reversal could follow if momentum weakens further amid stagnant derivative interest.

Bitcoin Price Rally Lacks Institutional Backing

Open Interest on CME for Bitcoin price bill remains subdued and below early 2025 levels, revealing weak institutional engagement. Even with all-time highs, futures activity hasn’t picked up significantly. This reflects hesitancy from large market participants to commit capital at these levels.

The CME annualized basis, comparing futures and spot prices, also remains low. This underlines a narrow premium for holding long positions. It confirms that futures traders expect limited upside in the short term.

Bitcoin price bills continue rising, but institutional activity remains tepid, supporting a potential pullback. Low futures engagement combined with minimal basis strengthens the case for a price retracement. This condition could drive a correction back to $100,000 as large players remain on the sidelines.

On-Chain Metrics and MVRV Ratio Point to Profit-Taking Risks

Blockchain data reveals a notable decline in daily active addresses and new wallets interacting with the Bitcoin network. However, the price of BTC has continued to climb higher, indicating a bearish divergence. This signals that market participation and price are not growing.

A lack of new entrants and fewer active users implies weakening demand, even as prices touch record levels. This often precedes corrections, especially in overheated markets. This divergence highlights the fragility of the current rally.

Meanwhile, the MVRV ratio shows that recent buyers hold over 10% unrealized profits. Historically, Bitcoin price bills reverse when this metric crosses the 10% to 15% range. Profit-taking pressure from these holders could trigger a fall to $100,000.

 

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