Michael Saylor signals MicroStrategy's additional purchase: Bitcoin gets trapped in "ETF inflow failure" amidst extreme fear

As market sentiment in the cryptocurrency space plunges into “Extreme Fear,” MicroStrategy co-founder Michael Saylor hinted on social media that he will continue to increase his Bitcoin holdings, demonstrating long-term confidence. However, the market has not been uplifted by this, and Bitcoin’s price remains range-bound. Bitwise analysts point out that early holders are continuously selling call options, creating strong supply pressure, which prevents the price from rising even as Bitcoin spot ETFs see net capital inflows. Derivatives data also confirm this deadlock, with declining trading volume and a slight increase in open interest, indicating a lack of clear directional momentum in the market.

Market at a Standstill: Saylor’s “Orange Dot” Contrasts with Extreme Fear

When the cryptocurrency Fear & Greed Index remains below 21 for several weeks, in the “Extreme Fear” zone, the market is generally shrouded in caution and pessimism. Yet, Bitcoin’s most prominent corporate advocate, Michael Saylor, has once again made a contrarian statement. His company, MicroStrategy, posted hints on social media of “more orange dots,” widely interpreted as a signal that the company is about to buy more Bitcoin. This move starkly contrasts with the current subdued market sentiment, as if there’s a clash of hot and cold.

As the largest institutional holder of Bitcoin among publicly traded companies, MicroStrategy’s actions are a market bellwether. According to data from specialized tracking websites, the company owns over 708,000 BTC, valued at nearly $59 billion at the current price of approximately $89,273 per Bitcoin. More critically, its average purchase cost is significantly below the current market price, providing a solid financial foundation for long-term holding and underscoring strong belief in Bitcoin as a store of value. Saylor’s hint is undoubtedly a signal to investors to “hold firm” amid market panic.

However, market sentiment indicators tell a different story. The Fear & Greed Index remains deeply in the “Extreme Fear” zone, reflecting widespread risk-averse behavior among traders. This sentiment is often associated with sharp price declines or prolonged sideways movement, indicating a lack of confidence in the short-term outlook. The stark contrast between Saylor’s optimistic stance and the overall market mood reveals a core contradiction in Bitcoin’s current environment: the long-term conviction of whales versus the short-term structural pressures.

What is the Cryptocurrency Fear & Greed Index? It is a comprehensive indicator that quantifies market sentiment by analyzing multiple data sources, including price volatility, trading volume, social media chatter, surveys, and Bitcoin’s overall market share. The index ranges from 0 to 100, with lower values indicating greater fear and higher values indicating greed. It is widely used as a tool to identify potential market turning points. When the index hits extreme levels (below 20 or above 80), it often suggests excessive pessimism or exuberance, creating opportunities for contrarian strategies. Currently, the index’s deep plunge into “Extreme Fear” exemplifies an extreme in market sentiment.

Why Do ETF Capital Flows Fail to Lift Prices? Options Selling Creates Invisible Resistance

An intriguing phenomenon is unfolding: US Bitcoin spot ETFs continue to see net capital inflows, yet Bitcoin’s price struggles to break resistance and remains in a dull range. Jeff Park, head of research at Bitwise, offers insights into this. He points out that the key issue lies in the behavior of early Bitcoin holders (often called “OGs” or whales). These holders are continuously selling call options, generating additional, covert supply in the market.

How does this work specifically? When early holders sell call options, they commit to selling Bitcoin at a specified future price. To hedge the risk of these options, market makers often need to sell Bitcoin in the spot market beforehand. This ongoing, mechanized selling pressure acts like an “invisible ceiling,” offsetting the buying power from ETF inflows. As a result, despite products like BlackRock’s IBIT ETF accumulating spot Bitcoin, prices find it difficult to break through effectively.

This phenomenon also reflects broader institutional attitude divergence. On one hand, traditional financial giants are accepting Bitcoin through ETFs; on the other, some institutions remain highly skeptical. For example, asset management giant Vanguard previously dismissed Bitcoin as a “toy,” despite offering clients access to Bitcoin ETF products. This cognitive dissonance manifests in market behavior: inflows of funds do not translate straightforwardly into price gains, as complex derivatives market dynamics impose constraints.

Key Market Data Reveal Range-Bound Nature

• Bitcoin spot ETF performance: Net inflows continue, but prices remain subdued.
• Early holder behavior: Continued selling of call options creates mechanized supply.
• Market sentiment indicators: Fear & Greed Index below 21, in “Extreme Fear.”
• MicroStrategy holdings: 708,000 BTC, with clear cost advantage, ongoing accumulation.

Derivatives Data Confirm Deadlock: Shrinking Trading Volume and Holders’ Wait-and-See

Jeff Park’s analysis is corroborated by derivatives market data. He notes that breaking the deadlock requires demand for ETF-related options—like IBIT—to surpass the supply of native Bitcoin options. In simple terms, a stronger force must absorb the options sell pressure created by early holders. If volatility supply (option puts and calls) doesn’t ease, and demand for ETF-linked options doesn’t grow, Bitcoin’s price is likely to remain range-bound.

Recent on-chain data depict this scenario clearly. According to Coinglass, Bitcoin futures trading volume recently declined by about 24%, to around $49 billion. The significant contraction reflects reduced speculative activity and short-term confidence. Investors prefer to wait rather than actively bet on direction. This volume contraction is typical before major directional moves.

Meanwhile, open interest in Bitcoin futures has increased by 3.2%, reaching roughly $60.7 billion. The combination of rising open interest and declining trading volume suggests existing positions are being held (“locked in”), with little new capital entering to push prices into a trend. Participants appear “stuck” at current levels, awaiting a catalyst to break the equilibrium. At the same time, Bitcoin’s fundamental developments continue, such as PNC Bank’s partnership with Coinbase to expand Bitcoin trading services to more U.S. users, supporting the long-term outlook.

Future Outlook: When Will the Market Break the Deadlock?

Bitcoin is currently at a delicate equilibrium. On one side, long-term believers like Saylor and ongoing ETF capital inflows act as “support” forces; on the other, structural selling pressure from derivatives markets and pervasive “Extreme Fear” sentiment form strong overhead resistance. This stalemate keeps prices range-bound.

For investors, understanding this market structure is crucial. A short-term breakout may depend on one or more triggers: first, early holders slowing or halting call option sales, easing overhead supply; second, new buy orders strong enough to absorb option sell pressure—possibly from large institutional investors; third, an extreme reversal in market sentiment, swiftly shifting from “Extreme Fear” to “Greed,” attracting sidelined capital. Until these signals emerge, range-bound trading may continue.

From a broader perspective, this phase can be viewed as a “ digestion and stress test” in Bitcoin’s institutional adoption process. The market is learning to process and integrate the complex effects of traditional financial tools like ETFs and options. Although the path may be bumpy, each structural adjustment helps lay the groundwork for a healthier, more sustainable rally. For believers, as Saylor’s actions suggest, maintaining calm amid fear and focusing on the long-term narrative remains key to cycling through cycles.

MicroStrategy and Its Bitcoin Strategy

Founded in 1989, MicroStrategy is a US-based company specializing in business intelligence, mobile software, and cloud computing. Since August 2020, under Saylor’s leadership, the company shifted its core corporate treasury strategy to Bitcoin, viewing it as a primary reserve asset to hedge against currency inflation. The company has continuously bought Bitcoin through bonds, equity, and other financing methods, accumulating over 708,000 BTC, far exceeding other public companies. This aggressive approach has made its stock price highly correlated with Bitcoin’s price and serves as a classic case for corporate Bitcoin allocation feasibility. Saylor himself has become a Bitcoin evangelist, with a “HODL” strategy that resonates within the crypto community.

When “Extreme Fear” meets “Steadfast Accumulation,” Bitcoin’s market reveals a complex game of forces. MicroStrategy’s orange dot symbolizes long-term faith, but the sophisticated machinery of derivatives markets locks in upside potential. This “struggle” driven by ETF inflows and options selling highlights the pains and adjustments in Bitcoin’s integration into traditional finance. Ranging sideways may be dull, but in such stalemates, market structures are reshaped and strength is built for the next breakout. For observers, it’s not just about price candlesticks but understanding the deeper stories behind data—confidence, structure, and time.