Bitcoin Demand Reverses, But Long-Term Outlook Remains Unchanged

In accordance with Odaily, NYDIG's head of research Greg Cipolaro noted in a Friday report that key drivers behind Bitcoin's recent peak, including ETF inflows and DAT demand, are now contributing to a price decline to multi-month lows. Cipolaro highlighted a major liquidation event in early October that reversed ETF inflows, collapsed DAT premiums, and reduced stablecoin supply, signaling liquidity is exiting the system. He explained that once this cycle breaks, markets typically follow a predictable pattern: liquidity tightens, leverage struggles to build, and prior bullish narratives fail to convert into capital flows. Spot Bitcoin ETFs have shifted from a reliable inflow engine to a 'significant drag.' During cyclical pullbacks, Bitcoin dominance often rises as speculative assets face sharper liquidations and capital consolidates into the most mature and liquid assets. Data shows Bitcoin dominance surged above 60% in early November and stabilized around 58% as of Monday. Cipolaro noted that DAT and stablecoin supply have seen their first decline in months, suggesting investors are withdrawing liquidity. However, he emphasized that the DAT sector is still far from a true pressure point, with leverage remaining moderate and interest obligations manageable. Despite the recent downturn, Cipolaro maintains that Bitcoin's long-term trajectory remains intact, citing ongoing institutional interest, slowly building sovereign demand, and its role as a neutral, programmable monetary asset.