Bitfinex alpha | BTC integrates and leverages drops as the market is waiting for a catalyst

04 August Bitfinex alpha | BTC integrates and leverages drops as the market is waiting for a catalyst

Bitcoin has crucially destroyed local range support at $115,800, reaching its $112,210 low after multiple retests over the past three weeks. This failure coincides with the wider risk across the entire crypto complex, especially in altcoins where leverage was actively constructed. The other indexes represent the broader Altcoin market, but they excluded the top 10 coins by market capitalization, resulting in a drawdown of 18.7% over the last 10 days, eliminating nearly $59 billion in market capitalization before rebounding on Sunday.

This surrender phase peaked on August 2nd, with daily liquidation exceeding $1 billion. BTC and ETH were leading the liquidation volume, but Altcoins experienced a deeper drawdown in 2025 with a total crypto liquidation marking one of the most offensive rewinds. Despite the high betty nature of Altcoins, even key assets like ETH reduced the week by 9.7%, while the Broader Others Index fell 11.4%. Just a few names like ENA and Pengu highlight how limited capital turnover has turned amid increased macro pressure and reduced risk.

Structurally, BTC still holds a relative strength position with a market capitalization of over $2.2 trillion. This postpones the 2021 cycle peak, but ETH and Altcoins are below previous highs. This difference highlights the role of BTC as an institutionally driven asset for macroresidents, in contrast to the speculative vulnerability of the broader market. As ETF flows cool, Fed policies turn into more takis and risk appetite declines, consolidation or further downsides are expected, unless aggressive spot buying is re-emerged. The technical bounce from the $112,000 area is plausible, but the broader recovery could be dependent on facility flows or updated demand via clear macrocatalysts.

Latest economic data from the US highlights the growing vulnerability under seemingly resilient headline figures. The June inflation report revealed enduring price pressures driven primarily by new tariffs that reduced the costs of goods, such as furniture, clothing and recreational items.

Personal Consumption Expenses (PCE) rose modestly, but actual consumer spending was hardly moving. This indicates that inflation is undermining purchasing power. Wage growth has softened, with GDP rising by 3% in the second quarter, much of which is due to a sharp decline in imports, increasing weak domestic demand.

Excluding trade and inventory, actual GDP rose by just 1.2%, referring to a stagnant business investment and slowing consumer activity. Meanwhile, the July employment report has been added to the darkness. Employment slowed to just 73,000 new jobs, unemployment rates tickled at up to 4.2%, and workforce participation continued to decline. Despite the seasonal tailwinds, sectors such as construction and hospitality had declined in performance, but the decline in foreign-born workers reflected resistance to tightening immigration policies. These trends collectively complicate the Federal Reserve policy outlook. With the stickiness of inflation and declining labor force, the Fed is likely to slow down speed cuts, waiting for a more clear signal before adjusting its stance. In parallel, the crypto industry has experienced a strong revival of institutional engagement, characterized by bold Treasury allocations and reorganisation of regulatory authorities. Sharplink Gaming has created headlines with ETH’s $295 million purchase, increasing its total holdings by over 438,000, establishing it as the world’s second largest corporate holder. The company’s aggressive capital deployment and staking strategy, supported by Ethereum co-founder Joseph Lubin and former BlackRock executives, reflects the growing institutional convictions as a financial asset for ETH. Meanwhile, regulatory momentum has also been built. SEC Chairman Paul Atkins has launched Project Crypto, a drastic initiative to modernize the US digital asset framework. The initiative, which moves away from the highly-enforced agency past, promises clarity in token classification, enables authorized cryptography to “super apps,” encourages traditional tokenized finance, and recovers the potential of US leadership in digital innovation. Finally, DeVVStream, a NASDAQ-registered carbon credit company, has announced a $10 million allocation to Bitcoin and Solana as part of its Sustainable Cryptocurrency Program. Funded by the $300 million Convertible Notrease, the move combines financial strategy with environmental impact, highlighting Crypto’s integration into an increasingly diversified corporate finance model. Together, these developments demonstrate mature digital asset spaces that are increasingly aligned with both facility capital and forward-looking regulatory frameworks.