On May 25, the price of Bitcoin rose above $77,000, gaining 0.5% over the day and settling above the 50-day moving average at $76,940.
Hourly chart of BTC/USDT on Binance. Source: TradingView.The cryptocurrency market's growth coincided with a sharp decline in commodity prices, with WTI crude oil futures dropping over 5% to $91 per barrel. This led to a boost in Asian stock indices, with Japan's Nikkei 225 rising nearly 3% and India's Nifty 50 gaining more than 1%.
The positive momentum is linked to news of progress in negotiations between the U.S. and Iran. The parties are close to finalizing a deal that would fully restore shipping through the Strait of Hormuz. U.S. Secretary of State Marco Rubio confirmed that the agreement could be signed on May 25.
Altcoins showed moderate gains, with XRP and Solana rising 0.6% and Ethereum increasing by 0.4%. However, unlike Bitcoin, these assets are still trading below their 50-day moving averages.
Analysts remain cautious due to capital outflows from spot Bitcoin ETFs, with investors withdrawing over $2 billion in the past two weeks. According to BRN, for the rally to continue, the market needs a slowdown in fund selling and stable liquidity in stablecoins.
Bitcoin Demand Hits a Low
The visible demand for Bitcoin has fallen to its lowest level since the beginning of the year, according to an analyst using the pseudonym Darkfost.
Bitcoin Demand has Fallen to Its Most Bearish Level of the Year
“Even if this situation appears relatively bearish in the short term, these types of environments have historically also created interesting opportunities for long-term investors” – By @Darkfost_Coc pic.twitter.com/q5pesCl70H
— CryptoQuant.com (@cryptoquant_com) May 25, 2026
The indicator has dropped to -147,000 BTC, a level last seen in December 2023.
Visible demand is calculated as the difference between the issuance of new coins and the supply that has remained inactive for over a year. This metric indicates whether the accumulation pace of the asset is sufficient to absorb new Bitcoins in the network.
According to the expert, demand continues to decline. He emphasized that without a recovery in the spot market, it will be challenging for Bitcoin to maintain growth solely through futures.
“Derivatives amplify price movements, but for a sustainable bullish trend, real demand for the asset is needed. Derivatives do not create a stable foundation,” noted Darkfost.
He also added that periods of sharp declines in demand and pessimism have historically created opportunities for long-term investors.
Market Bottom
Joao Vedson, founder of the Alphractal platform, noted the differing performance metrics (Sharpe ratio) for the two largest cryptocurrencies.
Bitcoin and Ethereum’s Sharpe Ratios are behaving differently.
But both are showing the current market sentiment very clearly.
While Bitcoin’s annualized Sharpe Ratio is negative, indicating lower return efficiency relative to risk in the short term, Ethereum’s is sitting right… pic.twitter.com/oulOsDmiut
— Joao Wedson (@joao_wedson) May 22, 2026
Bitcoin's annual Sharpe ratio has turned negative, indicating that the asset's returns do not justify the risks in the short term. Ethereum's ratio is at a neutral level, around zero.
The expert stated that the current values indicate strong selling pressure and a lack of risk premium. However, historically, prolonged periods with a Sharpe ratio below zero have signaled the formation of a market bottom.
Vedson emphasized that the current situation does not guarantee an immediate price reversal. Nevertheless, the market is already in a zone of extreme pessimism and high stress.
The analyst advised monitoring risk behavior daily, as important signals often appear in metrics before they are reflected in price charts.
Meanwhile, an analyst using the pseudonym maartunn reported record selling pressure on Coinbase. According to him, the exchange is experiencing the strongest selling pressure since February.
🚨 Coinbase is seeing its STRONGEST SELLING PRESSURE since February. pic.twitter.com/AQbZ4FVmGF
— Maartunn (@JA_Maartun) May 22, 2026
Signal for Bitcoin Reversal
On-chain analyst MorenoDV noted a decline in Bitcoin's fund flow ratio on Binance, which has dropped to levels of 0.010-0.012.
Bitcoin's Fund Flow Ratio Returns to the Zone That's Marked Every Major Turn
“Bitcoin is approaching a decision zone: either demand remains weak, and the compression reflects apathy, or sell-side exhaustion becomes the foundation for the next recovery phase.” – By @MorenoDV_ pic.twitter.com/mox08h9etV
— CryptoQuant.com (@cryptoquant_com) May 22, 2026
This indicator measures the volume of Bitcoin on exchanges relative to the total number of transfers in the Bitcoin network. It shows what share of market activity is accounted for by exchange operations.
Since 2018, this metric has returned to this range five times, and historically, such periods have preceded significant trend changes.
A low reading indicates that investors are using exchanges less frequently for trading, which reduces selling pressure and often signals the formation of a price bottom. Analysts observed similar situations in early 2019 and 2020 before the market began to rise actively.
According to MorenoDV, the current situation reflects a phase of uncertainty. Either the market will continue to lack buyer interest, or seller exhaustion will become the basis for a new rally.
Ethereum Growth
Trader Michaël van de Poppe stated that the current Ethereum prices are suitable for accumulating long-term positions. He believes the asset remains a crucial infrastructure layer for the entire on-chain ecosystem, despite lagging behind the market in recent years.
This is the area to accumulate #Ethereum.
It's been lagging behind for years, but it's the infrastructure layer that is required for almost everything within the on-chain ecosystem.
The past months, the price of Ethereum has gone down primarily due to macroeconomic reasons.… pic.twitter.com/o3yUKvycPP
— Michaël van de Poppe (@CryptoMichNL) May 25, 2026
Van de Poppe attributed the recent decline in the second-largest cryptocurrency's price to macroeconomic factors, noting an inverse correlation between the decentralized finance sector and government bond yields.
As bond yields rise, investor interest in DeFi decreases, negatively impacting the value of the underlying asset of the network—Ethereum. However, he expects a reversal of this trend.
From a technical analysis perspective, the asset's price is approaching a strong support level on higher timeframes. Previously, the analyst predicted a correction after the price deviated from the 0.0325 BTC level. He now considers the current price range a favorable entry point into the market.
It is worth noting that on May 23, the first cryptocurrency fell below $75,000, a decline occurring amid testing of highs in traditional markets.