The recent Bitcoin surge back above the $100,000 mark may be due to speculative leverage rather than organic spot demand, according to new on-chain data.

Analytic platform Glassnode raised concerns about the rally’s sustainability, suggesting that speculative trading, not fundamental buying, is behind the move.

Leverage, Not Organic Demand, Pushed Bitcoin Higher

Earlier this month, Bitcoin briefly dipped below $100K for the first time in 12 weeks. However, it quickly rebounded, reaching $108,300 before undergoing a new correction. In a detailed report analyzing current market trends, Glassnode highlighted key factors driving this volatility.

One notable observation was that Bitcoin futures volume remained elevated during the recent surge. This indicates that short-term holders and active traders were significantly involved. However, this activity came with a caveat: a noticeable decline in momentum.

Specifically, futures volume has been trending downward for several weeks, suggesting fatigue in the derivatives market. While leverage-driven trading still dominates, the intensity of this activity has declined compared to historical levels.

More importantly, both funding rates and the 3-month rolling futures basis, key indicators of bullish sentiment, have also been falling. This decline suggests a move toward less aggressive long positioning.

Spot Volume Also Dipping

In contrast to previous rallies in Q2 2025 and Q4 2024, Bitcoin’s recent move was not accompanied by a surge in spot market activity. At its peak of $111,900 in May, spot volume remained relatively subdued, at around $7.7 billion, well below the previous cycle highs that exceeded $20 billion.

This divergence highlights a lack of new capital entering the market from long-term holders or retail investors. Glassnode suggests that this may be due to investor hesitation, which strengthens the case for consolidation rather than continued upward momentum.

What Does It Mean for Bitcoin’s Uptrend?

As the futures market contributed to price increases, the quality of participation appears weaker than earlier in the cycle. Traders remain engaged but with less conviction and greater caution. Notably, the drop in spot demand and the decline in funding rates highlight a market structure that is vulnerable to correction.

In essence, the current setup suggests Bitcoin’s recent highs are less about renewed belief in its fundamentals and more about leveraged positioning. It’s a sign that the market may require a reset before its next major move.

Institutional Buying Paints a Mixed Picture

Interestingly, the on-chain data contrasts with recent developments in institutional adoption. More companies than ever are announcing new Bitcoin acquisitions. 

This week alone, firms such as MicroStrategy, Metaplanet, and ProCap BTC acquired $1 billion in BTC. Additionally, Bitcoin ETFs purchased over $1.5 billion worth of BTC during the same period.

Amid this institutional buying spree, Glassnode now reports that the amount of Bitcoin readily available for acquisition has dropped to just 7 million BTC, indicating that around 14 million BTC are held by long-term investors.

This buying pressure could support further price appreciation, even though the risk of a short-term correction remains.

As of press time, Bitcoin is trading at $106,554, down 0.9% on the day.

Traders are now watching Bitcoin and the broader crypto market as fresh inflation data triggers questions about where U.S. monetary policy is headed next. 

The latest report shows that Core PCE, the Federal Reserve’s preferred measure of underlying inflation, rose by 0.2% in May, coming in slightly above the 0.1% economists had predicted. Notably, on an annual basis, core prices climbed 2.7%, also higher than the 2.6% forecast. 

These figures suggest that inflation isn’t cooling as smoothly as many had hoped, and that could slow down any plans the Fed might have had to cut interest rates.

For context, core PCE strips out food and energy prices, making it a more stable gauge of inflation. While headline inflation stayed in line with expectations, up 0.1% MoM and 2.3% year-over-year, the firmer core numbers show that price pressures remain sticky in the broader economy. 

Bitcoin Holds Steady Despite Hotter Core PCE Figures

Essentially, this makes it harder for the Fed to justify cutting rates any time soon, especially as it keeps a close eye on inflation trends before making its next move.

However, even with the hotter-than-expected inflation reading, Bitcoin has held up well. It slipped briefly after the report, falling 0.29% and dropping just below $107,000. 

Nonetheless, the dip didn’t last. Bitcoin quickly bounced back and is now hovering around $106,951. If it manages to close the day above $107,000, it could turn that level into a short-term support base, which might help cushion the blow if selling pressure picks up again.

Crypto traders are watching inflation numbers because they tie directly into the Fed’s approach to interest rates. Higher inflation typically leads to tighter monetary policy, which can weigh on risk assets. 

However, Bitcoin’s strong performance suggests many investors are still confident in its long-term role, whether as a hedge against inflation or a store of value.

No Interest Rate Cuts Soon

Recent comments from top policymakers and financial figures also suggest rate cuts might not be coming in soon. On June 24, Federal Reserve Chair Jerome Powell told lawmakers that the Fed plans to pause and take more time to evaluate incoming data before making any rate changes. 

He highlighted that new tariffs could drive prices higher and said the Fed wants to see how that plays out in upcoming reports.

Atlanta Fed President Raphael Bostic made similar comments. He said the Fed should wait before easing policy and predicted just one rate cut late in the year. Bostic pointed to rising costs from tariffs and ongoing strength in the job market as reasons for holding steady.

Meanwhile, President Donald Trump repeated his calls for the Fed to lower rates significantly, criticizing Powell’s leadership. Vice President JD Vance also accused the central bank of mishandling the situation by not easing policy after inflation cooled slightly in May.

Some market analysts believe that traders may be expecting too much too soon when it comes to rate cuts. They argue that unless Powell is replaced when his term ends in May 2026, the Fed is likely to stick with its cautious stance. 

Others warn that ongoing tariff pressures could keep inflation stuck around 3%, which raises concerns about stagflation—a mix of sluggish growth and high prices.