The Shifting Structure of Bitcoin's Bull Market
Veteran Bitcoin traders have just navigated what may be one of the most profitable cycles on record. However, the engine driving this rally looks fundamentally different from past bull markets. According to analysis by Ki Young Ju, founder of CryptoQuant, exchange-traded funds (ETFs) and digital asset treasury firms have emerged as the primary structural buyers, displacing the traditional dominance of crypto exchange traders.
New Market Forces: How ETFs and Institutions Are Reshaping Demand
This shift toward regulated products and professional capital has profound implications. One immediate effect has been a dramatic expansion in unrealized trader profits. Data indicates that the potential gains for traders on major exchanges have been pushed to nearly three times the levels seen at the peak of the 2021 cycle.
With Bitcoin's price trading in a range similar to two years ago, the market is clearly in a consolidation and digestion phase. A significant portion of accumulated unrealized profit is being managed through futures leverage. As some traders take profits, price action has stabilized around the average cost basis for these market participants.
Lingering Leverage: Data Points to Underlying Market Tension
Despite the ongoing adjustment, a key risk metric remains elevated. The on-chain market leverage ratio—typically calculated as BTC/USDT futures open interest divided by USDT reserves—has retreated from highs above 0.5 to approximately 0.3. Crucially, this level is still meaningfully higher than it was prior to the launch of U.S. spot Bitcoin ETFs.
Ki Young Ju suggests that if ETF inflows persist or accelerate, a renewed increase in futures leverage is likely. This sets the stage for potential volatility ahead.
Lessons from the Bottom: Whale Accumulation Patterns
The analysis also revisited pivotal behavior at the last cycle low. In 2023, as Bitcoin approached the $16,000 level, early "OG whale" investors executed large-scale accumulation. The buyer-to-seller ratio clearly shows that a substantial volume of market buy orders was placed during that period of peak pessimism, establishing a critical foundation for the subsequent recovery.
This pattern underscores the distinct roles played by long-term holders versus short-term leveraged traders at different market stages. It also explains why the sources of demand and market structure in this cycle have undergone such a fundamental transformation.