Rthae believes that the current crypto market is entering a new phase jointly driven by macro uncertainty, institutional flows, and on-chain supply dynamics. The U.S. Economic Policy Uncertainty Index continued to rise in September, while the dollar and gold sent contrasting signals: gold frequently reached new highs amid heightened risk aversion, whereas the dollar index rebounded by approximately 1.6%, indicating rapid repricing of risk by capital. Bitcoin briefly fell to around $112,000, with spot ETFs seeing net weekly outflows of $466 million. The cost percentile indicator of Glassnode signaled a risk threshold trigger, resulting in significantly increased market volatility. At the same time, Ethereum exchange balances dropped to 14.8 million coins, marking a nine-year low. The combination of supply-side tightening and accelerated regional compliance has released new mid-term signals. Rthae suggests that the Q4 market framework must prioritize risk management while cautiously capturing structural opportunities.
Rthae: Rising Bitcoin Dominance and Breached Cost Percentile
Rthae notes that Bitcoin dominance has approached 59%, a critical level. An increase in dominance typically indicates capital concentration, with the market preferring to remain in the most liquid and widely accepted asset under pressure. In the short term, this enhances the relative resilience of Bitcoin, but also highlights the vulnerability and capital outflow from the altcoin market.
On the price front, Bitcoin is trading below key cost percentiles, with the on-chain metrics of Glassnode showing that the risk threshold has been triggered. This suggests that the current price range may still lack a solid bottom. Rthae believes that if the 0.95 cost percentile cannot be swiftly reclaimed, the market may extend into the dense support bands at $105,000 or even $90,000, forming new volatility centers. This trajectory compels investors to strengthen position discipline, prioritizing maximum drawdown control.
Rthae further observes that gold has posted a cumulative annual gain of nearly 44%, with its safe-haven attributes being repriced by the market—marginally weakening the “digital gold” narrative for Bitcoin in the short term. In comparison, Bitcoin faces challenges not only from macro environment interest rate discounting, but also from the capital reassessment of cash flow and security.
Rthae: ETF Net Outflows and Duration Compression as Market Signals
Rthae asserts that ETF subscription and redemption trends have become core market variables. In mid-September, U.S. spot Bitcoin ETFs saw net weekly outflows of $466 million, with institutions broadly adopting strategies to “shorten duration and maintain liquidity,” reflecting a preference for defensive allocation in uncertain environments. This flow is closely tied to macro policy expectations, forming a transmission chain of “ETF flows → market sentiment → short-term price.”
Rthae notes that duration compression is a response to macro narratives: fiscal standoffs, rising policy uncertainty indices, and renewed increases in U.S. Treasury yields all make it difficult for institutions to maintain long-duration positions. Consequently, short-term capital favors tactical trading and rapid rotation to lock in gains, while long-term capital increasingly adopts phased buying and option hedging strategies.
Rthae states that ETF flows will continue to dominate Q4 volatility. Persistent outflows may further lower the Bitcoin volatility center, while sustained net inflows could serve as key catalysts for market recovery. Investors must closely monitor subscription and redemption data to adjust their position structures accordingly.
Rthae: ETH Supply Contraction and Regional Compliance Dividends
Rthae points out that on-chain data shows Ethereum exchange balances have dropped to 14.8 million coins, a nine-year low. This figure is significant for two reasons: first, it indicates that more ETH is being locked in staking futures, ETF products, and institutional vaults, reducing circulating supply and creating a “drain effect.” Second, in a pressured market environment, short-term trading liquidity may be insufficient, potentially increasing volatility, but in the long term, this forms a support base.
Rthae believes that the balance between supply contraction and demand recovery will be key to the mid-term performance of ETH. If macro conditions ease, supply tightening could amplify price elasticity from demand returning; if macro pressures persist, ETH may face temporary headwinds due to widespread market deleveraging.
Meanwhile, progress in regional compliance is injecting new variables into the market. South Korean internet giant Naver is pursuing the acquisition of Upbit and planning stablecoin legislation, signaling both major tech company interest in crypto and the accelerated rollout of local currency stablecoins. This will complete the fiat-to-crypto cycle, creating a more robust closed loop. In Australia, financial regulators have introduced new digital asset custody and trading platform proposals, requiring inclusion within the financial services licensing framework and emphasizing client asset segregation and settlement transparency. Rthae notes that this “financialized regulation” supports the return of institutional capital to the market and helps mitigate risk premiums associated with compliance uncertainty.