Crypto market April report: Tens of billions in funds pour in, BTC strong rebound

In April, BTC experienced a strong Rebound, increasing by 14.11% in a single month, recovering from previous declines. The global financial market was impacted by tariff disputes, causing panic to surge and asset prices to be significantly adjusted. However, as emotions were released and relatively strong U.S. economic data was published, investment funds flowed into U.S. stocks and the crypto market.

BTC adjusted ahead of US stocks, and after completing the bottoming out simultaneously, it surged strongly driven by a large amount of capital. Importantly, after more than two months of adjustment, the holding structure of BTC has greatly improved, and the internal state is more stable.

The S&P 500 and the crypto market have fully recovered from the declines caused by the tariff dispute. Although the tariff issue remains unresolved and the direction of the US economy is still unclear, the market is performing strongly, continuously pricing in new information. However, for a true reversal to occur, the tariff dispute needs to be resolved and further confirmation of US economic data is required. During this period, multiple fluctuations may be experienced.

Macroeconomics: Tariff disputes trigger severe market adjustments

At the beginning of April, the escalation of the tariff dispute triggered panic in the market, leading to a significant decline in the US stock market. Subsequently, a softened policy stance and relatively strong economic data eased market concerns. Investors bet that the tariff dispute would not lead to an economic recession, driving a strong rebound in the market.

Inflation data has shown signs of cooling, while employment data remains strong, temporarily alleviating market concerns about an economic recession. Although tariff negotiations are still ongoing and challenging, forward-looking capital is pouring in, driving a strong rebound in the US stock market.

In the short to medium term, the panic triggered by the tariff dispute has been relatively fully released. GDP data shows that the US economy has not yet suffered significant damage, and the policy attitude has become more rational, allowing forward-looking funds to boldly buy in. The adjustment from February to April may be a sharp correction of the overvalued US stocks after two consecutive years of gains under external shocks, a technical test of the bear market, but there is still insufficient data to indicate that the US economy will fall into recession.

Currently, US stock valuations have been adjusted downwards, but they are still not cheap, and the market pricing is relatively adequate. For further increases, more supportive conditions are needed, such as further easing of tariff disputes and a decline in inflation. Rate cut expectations have been postponed to July. After a significant rebound, we tend to have a neutral judgment and need to closely monitor the progress of tariff disputes and economic data. If the economy shows signs of deterioration, the market may adjust downwards again.

Crypto Assets: Solid Holding Structure + Positive Long-term Outlook

The BTC trend in April can be called a model of "reverse trading", buying in a fearful market sentiment, and then quickly rebounding in asset prices once the situation eases.

In April, BTC opened at $82534.31, fell to a low of $74420.69, and closed at $94182.54, resulting in a monthly increase of 14.11%, a rise of $11648.22, and a monthly volatility of 26.12%.

The overall trend for the month was a decline followed by a rise, with the lowest point occurring on April 7. After the official implementation of tariffs, it rebounded and gradually rose. There were far more up days than down days in the 30 trading days.

Technically, BTC has confirmed the long-term trend by bouncing back to the annual line three times during the sharp decline, strongly breaking through the 200-day line on April 22, returning to the "Trump bottom" and approaching the "first upward trend line" of this bull market.

BTC's performance is stronger than the US stock market, thanks to the price correction that began in March, increasing holdings by long-term holders and large investors, as well as supportive policies and applications.

Multiple states are advancing "Bitcoin Reserve Bills." On April 30, the Arizona House passed two Bitcoin Reserve Bills, awaiting the governor's signature. Once enacted, Arizona will become the first state in the U.S. to allow state finances to hold BTC, which is expected to accelerate similar efforts in other states.

The expansion of BTC applications and the rise in price are mutually reinforcing. From March to April, global financial market turmoil temporarily interrupted this process. However, the internal holding structure and operation of the crypto market remain intact and stable. After panic sentiment fades, BTC resumes its upward momentum. The future market will still be influenced by tariff disputes and macro-financial fluctuations, with a breakthrough of previous highs pending the resolution of tariff issues and the avoidance of a recession in the US economy.

Holding Structure: Long-term Holders, Large Investors Increasing Holdings, Long-term Buyers Entering

Since March, with the significant drop in BTC price, long-term holders have once again played the role of a "stabilizer", shifting from selling to increasing their holdings.

The group of large holders holding 100-1000 BTC has continued to increase their holdings during the downturn, accelerating their purchases in late April, adding more than 80,000 BTC throughout the month, becoming a backbone force supporting the market. This group will also be the main buyers from October to December 2023, and their behavior aligns with the characteristics of long-term investors. Their recognition of the current price range helps stabilize prices.

After various parties bought in, the BTC stock on the exchange decreased by about 60,000 coins in April.

Comparing the on-chain distribution of holdings on January 31 and April 30, the focus of holdings in the range of 74,000 to 100,000 USD has clearly shifted downward, with some holdings above 100,000 USD moving to the range of 74,000 to 94,000 USD.

The market fluctuations over the past two months show that new capital entering the market has been forced to sell during the decline, while the situation of insufficient holdings in the 74,000-94,000 range has been filled. Currently, short-term holders have exited from losses, and the percentage of BTC in a loss across the entire chain has dropped to 14%. The market selling pressure triggered by panic and losses has greatly improved.

Capital Flow: Over 10 Billion USD Seized

In the first half of April, funds overall flowed out, but stablecoin funds continued to flow in. Mid-month, as policy attitudes softened and the US stock market stabilized and rebounded, funds for the BTC spot ETF began to rush in, quickly pushing the BTC price above $94,000.

In April, the overall capital inflow was 8.4 billion USD, marking the sixth largest inflow month in this cycle. Additionally, a certain company increased its holdings by a total of 25,370 BTC through three fundraising events in April, investing over 2.2 billion USD. The total capital inflow across the entire market in April exceeded 10 billion USD.

The price trend of BTC reflects the flow of funds. Currently, the measurable capital inflow can be categorized into three types: BTC spot ETF channel funds, which often follow the fluctuations of the US stock market; fundraising from a certain company, which shows good continuity in inflow; and stablecoin channel funds, that is, on-site funds, which have basically maintained a positive inflow since October 2023.

Although the crypto market experienced severe fluctuations from February to April and technically fell into a bear market, the overall analysis of funding and the trend of long-term holder chips indicates that the market cycle is still in an upward phase, that is, a bull market. After the adjustment, the holdings have returned to the hands of long-term holders and large investors, which helps to strengthen the holding structure. Once the impact of the tariff dispute fades and market trading enthusiasm reignites, BTC prices are likely to break upward again.

Conclusion

After months of adjustments and coin redistribution, the crypto market has become more stable internally. Long-term holders possess more chips, the pressure of losses for short-term holders has been eliminated, and they have yet to see profits, with only 14% of BTC in a loss state. This internal condition provides solid support for market upward movement.

However, external uncertainties remain significant, especially the potential economic recession and rising inflation caused by tariff disputes, which may lead to a further downward adjustment of U.S. stock valuations and a delay in the Federal Reserve's interest rate cuts. This point needs special attention.

The market trend is the result of the combined forces of various parties' games under dynamic conditions. We are confident in the BTC trend for the second half of the year and the long term, but we must be wary of the unpredictable damage that tariff disputes can inflict on capital, sentiment, and the global economy.