Viewpoint: Bitcoin’s rebound momentum remains strong, with institutional allocations and speculative leverage rising in tandem.

Glassnode noted in a report that Bitcoin is currently trading around $78,600, having largely held onto the strong rally it launched from the $64,000 zone at the end of August after earlier breaking above $80,000. The broader digital asset market still shows strong institutional demand, though activity in spot and derivatives trading has cooled in some segments. Meanwhile, price momentum has clearly exceeded the upper bound of its statistical range. The secondary market’s trading volume and spot Cumulative Volume Delta (CVD) indicate that the balance of buying power in the market may be shifting, while retail participation has also weakened. Traditional finance capital continues to flow into regulated crypto investment products. U.S. spot Bitcoin ETF holdings remain profitable and have maintained weekly net inflows. At the same time, short-term, price-sensitive capital is entering the market, coinciding with high options open interest and a rapid narrowing of volatility spreads—signaling that market participants may be underestimating short-term volatility risks. On-chain data also reflects a pattern of "active settlement but weakening user participation": entity-adjusted transaction volumes are significantly above normal levels, while daily active addresses and total fee revenue have declined slightly. Overall, the Bitcoin market is in a transition phase from a strong rally to structural divergence. Sustained institutional capital allocation and a rebound in on-chain valuations are providing market support, though speculative leverage is rising and signs of short-term capital selling have begun to emerge. The market’s fundamentals remain solid, but short-term volatility and correction risks are on the rise.