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BTC’s Rising Leverage Trades Show Signs of Stress, Galaxy Digital Says

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Good Morning, Asia. Here’s what’s making news in the markets:

Welcome to Asia Morning Briefing, a daily summary of top stories during U.S. hours and an overview of market moves and analysis. For a detailed overview of U.S. markets, see CoinDesk’s Crypto Daybook Americas.

Leverage in crypto markets is surging back to bull-market levels, even as last Thursday’s pullback reminded traders how quickly overextended bets can unwind.

Galaxy Research’s Q2 State of Crypto Leverage shows crypto-collateralized loans expanded 27% last quarter to $53.1 billion, the highest since early 2022, powered by record demand in DeFi lending and a renewed appetite for risk.

That backdrop set the stage for last week’s shakeout.

Bitcoin’s retreat from $124,000 to as low as $118,000 triggered more than $1 billion in liquidations across crypto derivatives, the largest long wipeout since early August. Analysts framed it as healthy profit-taking rather than the start of a reversal, but it underscored how fragile the market becomes when leverage builds this quickly.

Galaxy’s analysts argue that stress points are already visible.

In July, a wave of withdrawals on Aave pushed ETH borrowing rates above Ethereum’s staking yields, breaking the economics of the popular “looping” trade where staked ETH is used as collateral to borrow more ETH. The unwinding triggered a rush to exit staking positions, sending Ethereum’s Beacon Chain exit queue to a record 13 days.

Galaxy has also flagged that borrowing costs for USDC in the over-the-counter market have been climbing since July, even as on-chain lending rates remain flat.

The spread between the two has widened to its highest level since late 2024. That disconnect suggests demand for dollars off-chain is outpacing liquidity onchain, creating a mismatch that could amplify volatility if conditions tighten further.

With institutional demand and ETF inflows still supporting the bullish backdrop, strategists remain constructive on crypto.

But between ballooning loan volumes, concentration of lending power, DeFi liquidity crunches, and a widening gap between on-chain and off-chain dollar markets, the system is showing more points of stress, Galaxy writes.

Thursday’s $1B flush was a warning that the return of leverage is cutting both ways.

Market Movers

BTC: Volatility has plunged across markets ahead of Jerome Powell’s Jackson Hole speech, with traders betting on September rate cuts, but some warn complacency could mask risks as BTC trades at $118,061.51, up 0.44%.

ETH: A record $3.8B in Ether is queued for unstaking with a 15-day wait, adding potential profit-taking pressure even as ETF and treasury demand surges, with ETH trading at $4,524.10, up 2.13%.

Gold: Gold is trading at $3,332.95, down 0.11%, as hotter U.S. inflation data cut Fed rate-cut bets and left XAU/USD consolidating above key $3,310 support ahead of Powell’s Jackson Hole speech.

Elsewhere in Crypto

  • Stablecoin Boom Has Made Crypto Ramps ‘Sexier’ M&A Targets, Says VanEck VC (Decrypt)
  • Why Circle and Stripe (And Many Others) Are Launching Their Own Blockchains (CoinDesk)
  • Gemini Hires Goldmans, Citi, Morgan Stanley and Cantor as Lead Bookrunners For its IPO (CoinDesk)



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“This weakness will pass:” Arthur Hayes on BTC’s slide under $100k
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“This weakness will pass:” Arthur Hayes on BTC’s slide under $100k

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Bitcoin’s recent pullback hasn’t shaken market sentiment, and industry veteran Arthur Hayes is confident in the asset’s long-term strength.

In a June 22 X post, BitMex co-founder Arthur Hayes offered an optimistic take on Bitcoin’s (BTC) outlook, hinting at renewed strength ahead despite the ongoing market volatility. 

“This weakness shall pass and $BTC will leave no doubt as to its safe haven status,” he wrote. 

In his view, the recent dip is just a temporary phase, and the broader economic backdrop could soon turn favorable for Bitcoin. Hayes suggested that the rising global pressure may lead to increased liquidity injected into the financial system, which could benefit and restore Bitcoin as a reliable store of value.

Do you hear that? … it’s the sound of the money printers revving up to do their patriotic duty. This weakness shall pass and $BTC will leave no doubt as to its safe haven status. pic.twitter.com/PTfZaAXFp7

— Arthur Hayes (@CryptoHayes) June 22, 2025

The BitMex co-founder’s comments came after Bitcoin briefly dipped below the $100,000 mark during the weekend, hitting $98,000 amid growing geopolitical tensions. While the asset has since bounced back to trade above $101,000, the recent slide marked its lowest level since early May, roughly an 11% drop from its highest point during this period.

The decline in the market giant’s price was not isolated, and part of a broader downturn across the crypto market, marked by severe liquidations and a plunge in the market capitalization of all cryptocurrencies.

Arthur Hayes is not the only industry figure bullish on BTC. Pro-Bitcoin Michael Saylor also recently reaffirmed his positive outlook on Bitcoin, saying, “Nothing stops this orange” in a separate post.

However, from a technical perspective, Bitcoin still shows signs of short-term weakness. Market analyst Rekt Capital pointed out that Bitcoin is again testing key support around $104,400, a level it has dipped below for the second time in recent weeks. 

#BTC

Two weeks ago, Bitcoin downside wicked almost -4% below $104400 before ultimately Weekly Closing above said level

This week, Bitcoin is downside wicking -5% below $104400

Of course, Bitcoin could very well confirm a breakdown

But until the Weekly Close is in, it’s not a… https://t.co/owl2S0V9ur pic.twitter.com/jPe5qUaCnC

— Rekt Capital (@rektcapital) June 22, 2025

Unless the token closes the week above this level, the $104,400 level may flip into resistance, opening the door to further downside. Bitcoin is trading at $101,712 at press time, holding steady over the past 24 hours as its rebound continues.





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Bitcoin Bull Market Holding: BTC’s Strength Above This Key Level Keeps Rally Hopes Alive

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With a recent pullback from the $110,000 mark, which Bitcoin retested last Wednesday, the flagship asset has witnessed a persistent decline to the $104,000 support level. BTC’s sharp decline appears to have triggered bearish sentiment across the sector, but the broader market sentiment is still bullish.

BTC Bullish Market Outlook Still Intact

Bitcoin has revisited the $104,000 price level as bearish pressure mounts within the crypto market. However, despite recent growing volatility, BTC is still trading above a critical price level that characterises negative danger from bullish momentum.

Specifically, this key level is considered as short-term holders’ realized price, which is currently located in the $98,300 range. This crucial level, which is widely monitored by short-term traders, has historically supported sustained upward trends and indicated market strength despite broader macro uncertainty.

According to Alphractal, an advanced on-chain data and investment platform, the $98,300 is “the last level keeping investors in profit,” as BTC’s waning price action extends. As long as the flagship asset stays above the critical short-term holders’ realized price, the on-chain platform is confident that the BTC bull market is not over yet.

BTC holding above STH realized price | Source: Alphractal on X

Such a claim suggests that Bitcoin is still stable, exhibiting minimal volatility, and still has more room to grow. Nonetheless, the only way the situation can be altered is if Bitcoin’s price aggressively drops below the $98,000 mark, which may lead to a more significant decline in the short term.

Thus far, Alphractal noted that it would be wise to place a stop loss slightly below $98,000. Since BTC’s position above this level hints at a sustained bull market, it implies that investors do not see the current decline as the start of a downturn, but rather as a healthy consolidation phase.

Selling Pressure From Bitcoin Short-Term Holders Is Diminishing

This sentiment is also reflected in the Bitcoin Buy/Sell Pressure Delta, a key metric that determines whether buying or selling activity is currently dominating the market. After examining the metric, Alphractal has highlighted a positive development among short-term investors.

In the report shared on X, the on-chain platform revealed that selling pressure on BTC from short-term holders has risen to an oversold region. Alphractal claims that the trend is typically a sign of a pause in the ongoing decline in BTC’s price, while the oversold condition offers a new buying opportunity for traders anticipating a possible rebound from present price levels.

To put it differently, this notable shift in behavior implies that the current surge of panic selling and profit-taking carried out by these investors is wearing itself out. With selling pressure dying down among short-term Bitcoin holders, it could indicate a potential impending rebound, with key levels like the STH Realized Price holding strong against bearish attempts.

BTC trading at $104,838 on the 1D chart | Source: BTCUSDT on Tradingview.com

Featured image from Pixabay, chart from Tradingview.com

Editorial Process for bitcoinist is centered on delivering thoroughly researched, accurate, and unbiased content. We uphold strict sourcing standards, and each page undergoes diligent review by our team of top technology experts and seasoned editors. This process ensures the integrity, relevance, and value of our content for our readers.



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Bitcoin SOPR Indicator Sees Steady Decline Even As BTC’s Price Rallies – Here’s What It Means

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Bitcoin’s price has displayed remarkable resilience as the largest crypto asset holds strong above the $100,000 milestone despite several pullback attempts. During the robust bullish performance of BTC in the past few weeks, on-chain data shows that the SOPR indicator has been dropping sharply.

Key Bitcoin SOPR Indicator Dips Sharply

As Bitcoin continues to show upside strength, Rafaela Romano, a crypto enthusiast, highlighted that a significant divergence is developing below the surface. In a surprising turn of events, Bitcoin’s Spent Output Profit Ratio (SOPR) Indicator has witnessed a notable decline amidst a stunning rise in BTC’s price.

The crypto enthusiast reported the unusual development in a recent post on the X platform. In the past, the SOPR indicator, a key on-chain metric used to gauge overall market profitability, has aligned strongly with BTC’s performance.

 When the price climbs, the Spent Output Profit Ratio rises as well, hitting new highs at every new price point. Such an alignment between price movements and the indicator’s upside move is reflected by huge profit-taking from investors and traders during price spikes.

SOPR on a downward trend | Source: Rafaela Romano on X

However, while Bitcoin’s price has risen strongly and is holding beyond the $100,000 mark, this metric has been falling at a rapid pace. “Interestingly, the price of Bitcoin has been rising, but profit-taking is not keeping up,” the crypto enthusiast stated.

This current divergence suggests that many investors are confident about the flagship asset’s prospects in the short term as they continue to accumulate and hold their coins. According to the enthusiast, the trend is a sign that BTC holders, especially seasoned investors or long-term holders, still consider the $100,000 level a cheap value. 

A bullish sentiment of this magnitude among seasoned investors could pave the way for BTC’s next major rally in the short term as long as these key players continue to purchase the asset.

A Weakened BTC Net Realized Profits

Investors’ conviction in Bitcoin is undoubtedly growing strong in the current market environment. Another crucial indication of waning profit-taking by investors is a continued decrease in the BTC Net Realized Profit.

Related Reading: Bitcoin Long-Term Holders Strengthen Their Grip As Realized Cap Climbs To Uncharted Territory

As reported by Darkfost, a verified author and on-chain expert, this metric has decreased even as BTC maintains its upside trajectory compared to past scenarios. In early 2024, when Bitcoin reached a top, the net realized profits rose to $3.5 billion. Also, when the asset climbed to its previous top in January this year, profit-taking grew to $4.5 billion.

Meanwhile, data shows that profit-taking declined sharply to $1.8 billion following BTC’s surge to its current top in May. Currently, realized profits have decreased further, dropping to barely $700 million in the last seven days after reaching $110,000 on Thursday.

Darkfost noted that the trend suggests most BTC holders remain patient on the sidelines, opting to hold instead of taking profits. However, the expert has underscored the importance of caution as a shift in sentiment is probable if BTC loses its uptrend and enters a correction phase.

BTC trading at $104,889 on the 1D chart | Source: BTCUSDT on Tradingview.com

Featured image from Getty Images, chart from Tradingview.com

Editorial Process for bitcoinist is centered on delivering thoroughly researched, accurate, and unbiased content. We uphold strict sourcing standards, and each page undergoes diligent review by our team of top technology experts and seasoned editors. This process ensures the integrity, relevance, and value of our content for our readers.



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Bitcoin Demand In US Grows: Coinbase Premium Index Back In Positive Zone Amid BTC’s Rally

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Even with Bitcoin’s price experiencing waning performance or growing bearish pressure, bullish sentiment continues to increase strongly in the broader crypto market. Following the recent rally to a new all-time high, there has been a notable improvement in the BTC’s Coinbase Premium Index.

Positive Bitcoin Coinbase Premium Index

Bitcoin’s price may have experienced a slight pullback, but several key aspects still indicate a potential continuation of its recent upward trend. As the flagship digital asset gears up for an extended rally, Alphractal, an on-chain data analytics platform, mentions that a key market indicator is flashing signs of renewed investors’ interest.

In its post on X, the platform announced that Bitcoin’s Coinbase Premium Index has returned to positive territory after rallying to a new all-time high. This bullish shift has ignited newfound optimism in the market, generating more interest in the crypto giant.

Specifically, the Coinbase Premium Index is a crucial market indicator that calculates the difference in Bitcoin’s price on the Coinbase exchange and other international crypto exchanges.  The index’s move into positive territory implies that many traders in the United States are once again paying more to purchase BTC. “During Bitcoin’s latest rally, the Coinbase Premium Index turned positive again, signaling significant buying pressure from the U.S. market,” the platform stated.

Coinbase premium resuming its bullish course | Source: Alphractal on X

Alphractal noted that when the metric is positive, as it is now, it indicates that BTC is trading at a premium on the Coinbase exchange, which represents stronger demand from US-based markets. Such a pattern is frequently linked to institutional accumulation and an increase in local demand. According to the on-chain expert, the shift is a signal worth paying close attention to in the recent market trends.

Presently, the development provides Bitcoin’s ongoing upward trend an additional boost and may support the current bullish market sentiment. With the growing adoption and interest in BTC from US investors, the flagship asset could be poised for another major rally as seen in past scenarios, suggesting that the bull market is not yet over.

A Resurgence Of BTC’s Whale Investors

Heightened interest has gained steam among major BTC investors. While prices have briefly declined, the number of whale wallet addresses holding 1,000 BTC or more has started to climb once again, a trend that signals renewed conviction in the asset.

A recent report from Glassnode shows that these large investors have begun increasing after dropping in late April. From late April till now, this cohort rose to 1,455 even as BTC’s price surged to a new all-time high days ago.

This increase amidst the current consolidation phase raises the possibility that long-term investors and institutional players are capitalizing on recent price swings and preparing for a future change in the market. Since growing whale accumulation has historically led to major moves, this development could be a bullish indication of a sustained uptrend.

BTC trading at $109,065 on the 1D chart | Source: BTCUSDT on Tradingview.com

Featured image from Getty Images, chart from Tradingview.com

Editorial Process for bitcoinist is centered on delivering thoroughly researched, accurate, and unbiased content. We uphold strict sourcing standards, and each page undergoes diligent review by our team of top technology experts and seasoned editors. This process ensures the integrity, relevance, and value of our content for our readers.



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