Bitcoin’s impressive rebound over the Easter weekend marks a significant shift in market sentiment, with institutional investors stepping back into action. Will this upward momentum sustain?
On April 22, Bitcoin’s price jumped by 9%, breaking above the $91,000 barrier. This strong performance contrasted with modest rebounds in equity markets and mirrored bullish behavior in gold, which briefly reached a new all-time high near $3,500.
While the rebound itself and Bitcoin’s gradual decoupling from traditional equities are noteworthy, derivatives markets are sending even stronger bullish signals.
Data from CoinGlass shows that Bitcoin’s open interest (OI) surged by 17% to reach $6.83 billion, a two-month high. Open interest measures the total capital invested in Bitcoin derivatives, and an increase often reflects growing optimism among traders.
The market is currently in contango—a situation where futures prices (particularly CME Bitcoin futures) trade higher than the spot price. This typically occurs when investors anticipate price appreciation and use leverage to gain greater exposure through futures contracts than through direct spot purchases.
This brings us to two central questions: Who is buying, and why?
Renewed Institutional Interest
A key metric for understanding investor composition is the Coinbase Bitcoin Premium Index. This index tracks the percentage difference between Bitcoin’s price on Coinbase Pro (BTC/USD) and on Binance (BTC/USDT). Since Coinbase Pro caters mainly to U.S. institutional investors and Binance serves a broader global retail audience, a rising premium often indicates institutional buying pressure.
Although retail activity dominated the first half of April, institutional demand became evident between April 21 and April 22. According to CoinGlass, the Coinbase premium rose to 0.16% during this period.
MicroStrategy, led by Michael Saylor, appears to be among the key institutional players. On April 21, Saylor announced that the company had acquired an additional 6,556 Bitcoin at an average price of approximately $84,785 per coin, totaling around $555.8 million. This purchase brings MicroStrategy’s total holdings to a staggering 538,200 Bitcoin, valued at roughly $48.4 billion at current prices.
On a smaller scale, Japan-based Metaplanet also added 330 Bitcoin to its treasury, boosting its total holdings to 4,855 BTC, as announced by the company’s CEO on the same day.
Investors who prefer traditional financial instruments over direct Bitcoin ownership are also showing renewed interest. Bitcoin ETFs recorded $381 million in inflows on April 21—a welcome reversal after an extended period of outflows. Since February, ETFs had experienced net outflows on 33 days compared to only 21 days of inflows, with outflows significantly outweighing inflows. The recent shift suggests restored confidence among traditional finance (TradFi) investors.
Weakening U.S. Dollar, Strengthening Bitcoin
Institutional investors had remained cautious about Bitcoin and equities since tariff-related concerns began affecting markets, but that changed over the Easter weekend.
Cryptocurrency analyst Rekt Capital noted that Bitcoin has clearly broken out of its multi-month downtrend.
“The multi-month downtrend is over. Once a technical downtrend is broken, a technical uptrend follows.”
A broader macroeconomic factor may also be at play: the growing tension between former U.S. President Donald Trump and Federal Reserve Chair Jerome Powell. Their disagreements center on inflation risks stemming from proposed tariffs and the Fed’s reluctance to cut interest rates, casting uncertainty over the U.S. dollar’s outlook.
Since February, the U.S. Dollar Index (DXY)—which measures the dollar’s value against a basket of major currencies—has been in a steady decline, hitting its lowest level since 2022. Trump’s public pressure on Powell, along with speculation that he may attempt to remove Powell or other Fed officials, is heightening concerns about the central bank’s independence—a cornerstone of the U.S. financial system.
The consequences of a weaker dollar on the global economy are hard to predict, but one thing is clear: Bitcoin stands to benefit significantly. As a decentralized, censorship-resistant currency governed purely by code, with a fixed supply schedule and no central authority capable of manipulating its issuance, Bitcoin’s appeal strengthens as trust in traditional monetary systems wanes.
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Frequently Asked Questions
What caused Bitcoin’s recent price surge?
Bitcoin’s rally was driven by a combination of technical breakout from a multi-month downtrend, renewed institutional interest, and macroeconomic factors such as a weakening U.S. dollar.
How are institutions influencing Bitcoin’s price?
Institutions like MicroStrategy and Metaplanet are accumulating Bitcoin in large quantities, while renewed inflows into Bitcoin ETFs indicate growing confidence among traditional investors.
What is the significance of Bitcoin’s open interest surge?
A rise in open interest reflects increased capital flow into Bitcoin derivatives, signaling stronger bullish sentiment and expectations of further price appreciation.
Why does a weaker U.S. dollar benefit Bitcoin?
A declining dollar often leads investors to seek alternative stores of value like Bitcoin, which is decentralized, limited in supply, and independent of government monetary policies.
What is the Coinbase Premium Index?
The Coinbase Premium Index measures the price difference between Bitcoin on Coinbase (popular among U.S. institutions) and Binance (used more globally by retail traders). A positive premium suggests higher institutional demand.
Is Bitcoin’ decoupling from traditional markets sustainable?
While recent performance shows reduced correlation with equities, long-term decoupling depends on continued institutional adoption and macroeconomic conditions favoring digital assets over traditional investments.