Bitcoin is experiencing a pullback, but curiously, there aren’t the usual indicators of market overheating.

As we close Q2, Bitcoin (BTC) has impressively surged by 30% this quarter, a significant rebound from the 11.82% loss it faced in Q1. Yet, despite achieving a new all-time high, BTC has struggled to replicate the explosive gains of Q4 2024, when it almost doubled its value with a remarkable 47.73% return.

Market fears have certainly played their part. However, a recent report from Glassnode points to deeper structural issues that could reshape future price movements for Bitcoin.

A Shift in Market Dynamics: BTC's Pullback Amid Leverage Surge

Following the significant market shakeup in April, which saw Bitcoin drop to $74,393, a low not seen in months, savvy buyers found it to be an ideal entry point. The cryptocurrency then rebounded nearly 50%, reaching a new all-time high. What’s remarkable is the nature of this rally.

Unlike past surges, this one was not marked by extreme investor sentiment or retail frenzy—traditional indicators of overheating were absent.

On the surface, this rally appeared healthy, but a closer look revealed that open interest in Futures markets skyrocketed to $81 billion, adding nearly $30 billion in less than two months.

This spike meant that any dip in Bitcoin's price led to a wave of liquidations, creating a cycle of aggressive unwinding rather than controlled retracements.

Uneasy Q3 Ahead: Historical Trends and Macro Risks

If this pattern holds, liquidation schedules could mirror the cycles seen between late January and early April, where every downtrend adhered to leverage liquidity resets. Moreover, Q3 has historically been a lackluster period for Bitcoin, showing minimal returns in the last three years.

Adding to the uncertainty are broader macroeconomic risks. The Futures-to-Spot Volume ratio has become a crucial factor to monitor.

Can Bitcoin Sustain Its Momentum Without Support?

Glassnode's data explains why Bitcoin's ascent to $111k hasn’t followed typical overheating trends. Despite setting a new record, spot volume has languished at $7.7 billion, a stark contrast to the exuberant volumes seen during previous bull markets.

In contrast, Futures volume is on the rise, indicating that the momentum is driven more by speculative trading than by a broad base of spot market participants.

This structural imbalance aligns with AMBCrypto’s analysis: Excessive leveraged positions are currently steering Bitcoin's price trajectory, outpacing genuine retail engagement.

As we move into early Q3, the landscape appears precarious. With traders continuing to leverage their positions, the risk of another flush—similar to what occurred in Q1—remains very much alive.