Bitcoin remains locked in consolidation, trading between $86,000 and $93,000, as experts debate the need for volatility to fuel its next major move. Jeff Park of Bitwise Asset Management argues current low volatility and “horrible” trading volumes hinder upside momentum, while data shows a high long-to-short ratio elevating liquidation risks. Bloomberg’s Eric Balchunas frames the pause as a breather after years of outperformance against assets like gold and silver.
Bitcoin continues to trade within defined ranges, moving from $86,000 to $90,000 before testing a band between $90,000 and $93,000. This range-bound behavior suggests market accumulation is providing temporary stability.
Jeff Park, Head of Alpha Strategies at Bitwise Asset Management, has been explicit about what Bitcoin needs next. In a recent social media post, he argued that significant upside requires a resurgence in volatility.
“It is very unlikely for Bitcoin to find momentum to the upside without experiencing significantly higher volatility,” Park stated. He noted Bitcoin’s implied volatility sits near 38% while month-to-date trading volume remains notably weak.
Park believes the recent price action is driven primarily by short-term traders, with limited institutional involvement. That institutional flow is deemed essential for driving parabolic moves and restoring historical rally volatility.
Signs of rising volatility may be emerging beneath the surface. The Long/Short Ratio shows a clear dominance of long positions over shorts in derivatives markets.
On-chain analytics platform Alphractal recently warned this setup carries elevated liquidation risk. “As long as the BTC long-to-short ratio stays above the market average without price follow-through, the risk of further liquidations remains high,” the firm stated.
Liquidation data shows a significant flush of short positions, with $63.64 million wiped out compared to $15.38 million in long liquidations. That imbalance could reverse quickly if momentum shifts.
Eric Balchunas, senior ETF analyst at Bloomberg, offered a broader perspective on Bitcoin’s recent underperformance relative to precious metals. He argued the divergence is not inherently negative.
Balchunas noted Bitcoin has significantly outperformed most major assets since 2022, including gold and silver. He framed the current phase as a pause rather than a failure after that extended outperformance.
