New ETF inflows and evolving rate expectations allowed Bitcoin to stabilize after it faced a heavy level of selling that pushed the sentiment to its lowest point of the year. Fear gauges reached extreme lows as the Coinbase Premium recovered, showing a slowdown in panic selling and a return of buyer confidence. On-chain capitulation among short-term holders approached exhaustion, signaling renewed accumulation interest from stronger hands during the market’s reset phase.
Bitcoin is quietly entering a more stable phase after facing deep stress across sentiment, liquidity, and ETF flows. Recent market data points to a gradual move away from extreme fear as macro conditions improve and short-term capitulation eases.
Macro Shift Supports Early Stabilization
Bitcoin is responding to a drastic change in interest rate outlook that changed the prevailing risk tone. The odds of a December Federal Reserve rate cut surged from 30% to 71% within a day, and the easing of risk aversion provided a timely reprieve to the market. This change laid the groundwork for initial support to risk assets, including Bitcoin.
XWIN Research Japan noted that ETF flows quickly reflected this change. After a heavy −930 million dollars in outflows, spot Bitcoin ETFs recorded a +238 million dollars inflow. This move suggested that forced selling pressure was fading as conditions normalized.
This adjustment in macro expectations reduced some of the stress seen during the recent downturn. It also allowed Bitcoin to stabilize above key levels while investors waited for more consistent inflow patterns.
Fear Levels Approach a Turning Point
Market sentiment moved through one of its weakest phases this year. The Crypto Fear & Greed Index reached “10,” which is among its lowest readings in recent months. Public interest also dropped, forming an environment commonly seen during bottom formation periods.
Data shared by analysts showed that ETF outflows slowed during this stage and briefly turned positive. This transition aligned with the gradual recovery in the Coinbase Premium, which measures demand differences between U.S. and global markets. Its improvement signaled that panic selling was easing.
This trend suggested that fear had peaked and was no longer accelerating. The behavior matched earlier cycles where stress levels cooled before periods of renewed accumulation.
On-Chain Stress Nears Completion
On-chain data pointed to deep capitulation among short-term holders. XWIN Research Japan reported that unrealized losses among these holders reached 99%. Realized losses climbed to 4 billion dollars, while 81,000 BTC moved to exchanges during the sell-off.
Such extreme conditions have historically aligned with the end of forced selling phases. During these periods, stronger hands often begin re-accumulating as weaker holders exit positions. The recovery in the Coinbase Premium supported the view that this transition was underway.
Bitcoin seems to have entered a more neutral position after the worst of action this year, according to market observers, who go on to add that upcoming stability largely depends on continued ETF inflows over the next few days.