Analyst argues that Bitcoin’s recent price rise is fueled by ETF inflows and futures open interest rather than on-chain activity or network growth.

Bitcoin’s recent price rally has garnered significant attention from traders, analysts, and the crypto community alike. The price surge, which saw Bitcoin rise past the $94,000 mark in April 2025, has been linked to a variety of factors. However, an intriguing analysis suggests that the driving forces behind this rally might not be related to the usual suspects, such as network activity or blockchain fundamentals. Instead, the surge is believed to be heavily influenced by institutional movements, including ETF inflows and increased open interest in Bitcoin futures.

This article delves into the arguments presented by market experts, providing a detailed look into how ETF flows and futures contracts have become dominant catalysts for Bitcoin’s price movements, while on-chain activity has seemingly stagnated.

Bitcoin’s Recent Surge: A Shift in Market Dynamics

Over the past several weeks, Bitcoin has experienced a significant upward price trajectory, catching the attention of both retail and institutional investors. While the cryptocurrency’s price has been climbing, market analysts have pointed out a shift in the factors influencing Bitcoin’s price action.

Historically, Bitcoin’s price movements were closely tied to its network activity—specifically the increase in on-chain transactions, active addresses, and other key metrics. However, recent developments have sparked debates about whether this pattern still holds. The surge in Bitcoin’s price seems to be driven more by external factors, such as the large inflows into Bitcoin exchange-traded funds (ETFs) and rising open interest in Bitcoin futures contracts, rather than organic growth from network usage or blockchain activity.

Bitcoin Network: A ‘Ghost Town’ in Terms of Activity

A prominent analyst, Maartunn from Crypto Quant, recently pointed out that while Bitcoin’s price has been experiencing a steep upward climb, network activity is not mirroring this surge. In fact, according to Maartunn’s analysis, Bitcoin’s network has become eerily quiet, essentially resembling a “ghost town.”

The analyst’s claims are backed by data showing that, even as Bitcoin’s price reaches new heights, the network’s activity has stagnated. By examining the 365-day Moving Average of the network activity index, it’s clear that from 2015 to early 2025, network activity grew consistently in line with Bitcoin’s price growth. However, starting in 2025, a noticeable divergence occurred. Despite a significant rise in Bitcoin’s price, the growth in network activity slowed down dramatically, indicating that the demand for Bitcoin may not be coming from the traditional sources of retail or grassroots users.

ETF Inflows: Institutional Players Take the Lead

One of the most significant factors behind the recent price surge has been the substantial rise in Bitcoin ETF inflows. From April 17 to April 21, Bitcoin ETFs saw a remarkable increase in investments, reaching $381 million in inflows. By April 23, these inflows had surged to $917 million, reflecting a growing bullish sentiment among institutional investors.

These inflows align closely with Bitcoin’s price spike, suggesting that institutional capital is playing a pivotal role in driving the price higher. With institutional players continuously investing in Bitcoin through ETFs, the cryptocurrency market is becoming more institutionalized, with the price movements being increasingly dictated by institutional decisions rather than retail traders.

Since the launch of Bitcoin ETFs in the U.S., the sector has accumulated a total of $37.7 billion in net inflows. This staggering number indicates that institutional demand is a critical factor behind Bitcoin’s recent performance. As more institutional players enter the market through ETFs, their ability to move the price with large capital inflows becomes more pronounced.

Futures Market: Open Interest Soars

Alongside the rise in ETF inflows, Bitcoin futures contracts have also seen a significant increase in open interest. Data from Coinalyze shows that open interest in Bitcoin futures surged from approximately $24 billion on April 20 to over $27 billion by April 24. This rise in open interest is another key indicator of growing institutional participation in the market.

Open interest refers to the total value of outstanding futures contracts that have not been settled. As institutional players continue to engage in Bitcoin futures, the growing open interest further supports the idea that Bitcoin’s recent price surge is largely driven by external market forces, particularly institutional investors looking to hedge, speculate, or gain exposure to Bitcoin without directly purchasing the asset.

Contrasting On-Chain Data: A Decline in Active Addresses

While the futures market and ETF inflows suggest strong institutional involvement, on-chain data tells a different story. Data from Into The Block reveals a decline in key on-chain metrics, such as network activity and the number of active addresses. Over the past week, network activity dropped by 0.94%, while the number of active addresses fell by 1.51%.

Perhaps even more telling is the drop in zero-balance addresses, which decreased by 12.59%. This suggests that there is an increasing number of Bitcoin addresses that are no longer actively participating in the network, further reinforcing the idea that Bitcoin’s price surge is not being driven by user activity on the blockchain.

This disparity between price movements and network activity indicates that the current rally may be more speculative, driven by financial instruments like ETFs and futures, rather than genuine adoption or increased usage of the Bitcoin network itself.

The Role of External Factors in Bitcoin’s Price Surge

As we analyze the factors behind Bitcoin’s recent surge, it becomes clear that external forces, particularly institutional inflows into ETFs and the growth in Bitcoin futures open interest, have played a dominant role. While on-chain activity and network engagement are important for the long-term health of the Bitcoin ecosystem, the short-term price movements have been increasingly influenced by the actions of large financial institutions.

This shift in market dynamics suggests that the institutionalization of Bitcoin is continuing at a rapid pace. As more institutional investors gain exposure to Bitcoin through ETFs and futures contracts, the price of Bitcoin will likely become more susceptible to macroeconomic trends and institutional market movements rather than grassroots demand or network fundamentals.

Is Bitcoin’s Price Surge Sustainable?

The recent surge in Bitcoin’s price raises important questions about the sustainability of such a rally. While institutional inflows into Bitcoin ETFs and the surge in futures open interest have undoubtedly contributed to the price increase, it remains unclear whether this rally is sustainable in the long term. The decline in on-chain activity and active user engagement suggests that the rally may be driven more by speculative investment rather than genuine demand for Bitcoin’s underlying network and technology.

As Bitcoin continues to evolve, the market will likely see increasing participation from institutional investors, which may continue to influence the price in the short term. However, the key to sustaining Bitcoin’s long-term growth will be the continued development and adoption of its network by real users and businesses.

FAQs

1. Why is Bitcoin’s price increasing if on-chain activity is declining?
The price surge is primarily driven by institutional factors, such as Bitcoin ETF inflows and increased open interest in Bitcoin futures. These external factors are outweighing the typical correlation with on-chain activity.

2. What is the role of Bitcoin ETFs in the recent price surge?
Bitcoin ETFs have seen large inflows from institutional investors, which have helped drive up the price. These ETFs allow institutions to invest in Bitcoin without directly purchasing the cryptocurrency.

3. How does open interest in Bitcoin futures impact the price?
Open interest represents the total value of unsettled Bitcoin futures contracts. As open interest rises, it indicates greater institutional participation, which can drive up the price by increasing demand in the futures market.

4. Is the current Bitcoin rally sustainable?
The sustainability of the rally is uncertain. While institutional factors are driving the price up, a decline in on-chain activity suggests that the rally may not be supported by genuine demand for the Bitcoin network itself.

5. How can Bitcoin’s network activity impact its price?
Network activity typically correlates with price movements. A high level of on-chain activity often signals strong demand and adoption, which can support price growth. However, the current surge is driven more by speculative investment than network fundamentals.