- Global M2 surge clashes with Bitcoin’s consolidation; historical trends suggest eventual price realignment.
- Trade war tensions, China’s tariffs compound crypto market uncertainty, weakening short-term investor sentiment.
Alasdair Macleod, recently suggested that shorting Bitcoin could yield profits during the current downturn.
Shorting Bitcoin could be the most profitable way to play this bear market
— Alasdair Macleod (@MacleodFinance) April 6, 2025
His April 6, 2025, social media post drew sharp reactions from Bitcoin proponents, some of whom sarcastically urged him to act on his own advice. One user replied:
“Strongly encourage you to follow through with this suggestion with extreme size and leverage.”
Macleod, who began his career at the London Stock Exchange in 1970, has consistently criticized Bitcoin, labeling it “an outlet for speculation” in 2023. His latest remarks align with his longstanding skepticism, contrasting with figures like Bloomberg’s Mike McGlone, who recently speculated Bitcoin might drop by an order of magnitude.
Recent data highlights conflicting signals
The gap between Bitcoin’s market capitalization—calculated by multiplying its price by circulating supply—and its realized cap, which values each coin based on its last transaction price, has narrowed.
Historically, a declining market cap alongside a rising realized cap signals bearish conditions. This trend, observed since late 2024, mirrors patterns seen before past downturns. Separately, the growth of Tether’s reserves, often linked to crypto buying power, has stalled, suggesting stable but not expanding liquidity.
The M2 aggregate, tracking cash and deposits across major economies, surged in early 2025 while Bitcoin prices stagnated. Such divergences between monetary expansion and Bitcoin’s performance have historically corrected, potentially favoring price appreciation. However, escalating U.S.-China trade tensions, including Beijing’s 34% tariff hike in April, have dampened risk appetite, affecting crypto markets.
ETF Flows and ETHNews Analyst Warnings Reflect Caution
While BlackRock’s iShares Bitcoin Trust (IBIT) saw modest inflows in recent weeks, most competitors faced net outflows, reflecting short-term pessimism. CryptoQuant CEO Ki Young Ju reinforced this outlook, declaring the “bull cycle is over” based on realized cap analysis.
#Bitcoin bull cycle is over — here’s why.
There’s a concept in on-chain data called Realized Cap. It works like this: when BTC enters a blockchain wallet, it's considered a "buy," and when it leaves, it's treated as a "sell." Using this idea, we can estimate an average cost… pic.twitter.com/xDHRin8N1K
— Ki Young Ju (@ki_young_ju) April 5, 2025
By comparing 365-day moving averages of market cap and realized cap, Ju noted negative delta growth—a pattern last seen in December 2021, preceding a prolonged slump. He predicts the current bearish phase could extend six months.
Contradictions in Liquidity and Sentiment
While stablecoin reserves typically signal available buying power, their flat growth implies neither accumulation nor depletion. This contrasts with prior cycles where rising reserves often preceded rallies.
For now, macroeconomic uncertainty and technical indicators suggest a cautious stance, with analysts divided on whether Bitcoin’s slump reflects temporary pressure or a deeper shift.
Bitcoin (BTC) is trading at $79,251 USD, reflecting a sharp −5.10% daily drop. This marks a significant shift in sentiment as BTC breaks below the psychologically important $80,000 support level. The recent decline is part of a broader correction, with Bitcoin down −4.26% over the past week and −12.04% for the month, positioning Q1 as its worst-performing quarter in seven years. Year-to-date, BTC has declined by −15.27%, despite having posted a 27% gain over the past six months.
The downward move is attributed to a combination of global macroeconomic tensions, particularly the impact of U.S. tariffs, and fear-driven sell-offs in both the crypto and traditional markets.
A recent transfer of 1,928 BTC (worth approximately $160 million) to Kraken has further raised concerns about increased selling pressure from whales, potentially exacerbating volatility.
