Institutional demand for Bitcoin has fallen below new coin supply for the first time in seven months, suggesting large buyers are taking a step back amid a broader crypto market shift toward caution.
Bitcoin fell 2% in early Asian trading, falling below $107,000 as whales booked profits and ETF Capital continued to weigh on sentiment.
The correction follows pressure from “Red October,” when a $19 billion liquidation on October 19 created weak sentiment that carried into November. Traders see the move as a consolidation after a volatile month, with some positioning to Dip before the next rally.
Quick market update:
Bitcoin: $106,961, down 0.7%
Ether: $3,636, down 2.7%
XRP: $2.35, down 3.4%
Total crypto Capital : $3.64 trillion, down 1.6%
Institutional Demand Slows as New Bitcoin Supply Outpaces Storage
on-chain data reinforces the cautious sentiment. For the first time in seven months, institutional investor demand fell below the pace of new coin issuance, according to Charles Edwards, founder of Capriole Investments.
This is a sign that large buyers are temporarily withdrawing, in line with the general risk sentiment in the crypto market.
Meanwhile, US stocks were mixed: most major indexes rose on Monday after news that Amazon would provide cloud services to OpenAI, and the dollar rose to a three-month high against the euro as expectations of a sharp US interest rate cut eased. The S&P 500 and Nasdaq closed higher, helped by tech stocks, but Futures Contract later pointed to a softer open.
In Asia, tech stocks pulled Japan's Nikkei and Taiwan's TAIEX to record highs, while some regional markets fell after recent gains.
Fed signals caution, traders reduce rate cut expectations
Monetary policy remains the main macro factor. The Fed eased as expected, but Chairman Jerome Powell said a rate cut at its December meeting was “not a certainty,” a view that has kept traders from expecting too much easing.
Fed officials on Monday offered mixed views on growth and inflation, while the U.S. government shutdown has slowed key data, making it harder to predict December policy. Markets now price in about a 70% chance of a 25 basis point cut next month, down from about 94% a week ago.
After October shock, crypto market finds stability as leverage is “reset”
In crypto, the October liquidation wave wiped out leverage and risk Capital . Rebuilding this base takes time, so dips attract only selective buy orders, and rallies quickly lose steam as supply pours into exchanges.
“In many respects, the October correction did the right thing: deleveraging and resetting sentiment,” said Rachel Lin, CEO of SynFutures.
“ on-chain data shows that long-term investors are not giving up, they are still actively accumulating. The flow from the exchange remains stable, and history shows that this is a positive signal.”
She also said that November could start sideways as the market digests the Fed's comments. If inflation is lower than expected or the easing message is clearer, the market could rebound. Ethereum could follow a similar trend, thanks to network upgrades and growing institutional use of DeFi .
For now, the easiest path forward depends on Capital flows. If ETF outflows slow and inflows decline, spot prices could stabilize above recent lows. Until that happens, the market will continue to fluctuate on news, with macro and positioning factors determining the direction.
