Perspective matters. At first glance, the prolonged BTC/USD consolidation in the 65,000–75,000 range looks dull. However, by the end of March, Bitcoin had gained 2%, the S&P 500 had lost more than 5%, and gold had dropped 11%. The cryptocurrency usually moves in the same direction as equity indices, but its loss of sensitivity to both good and bad news has actually worked in its favor.

News from the Middle East sends shocks through the market. Donald Trump alternately spoke of a quick end to the conflict and threatened to bomb Iran's energy infrastructure and "make life hell" for the country. The US president issues ultimatums one moment and discusses making a deal the next. Despite rumors of possible talks on a 45?day ceasefire, the Polymarket betting market is lowering the chances of the war ending.

Dynamics of the probability of the war ending in Iran

Bitcoin is typically classed as a risk asset, so falling equity indices and a deterioration in global risk appetite put pressure on BTC/USD. Against this backdrop, the digital asset is being actively sold by so?called crypto whales — large token holders. According to CryptoQuant, apparent demand at the end of March was negative, amounting to 63,000 bitcoins. This refers to a metric that compares demand with newly mined token supply.

One would think that high geopolitical risk, a falling S&P 500 and mass whale sell?offs would drown BTC/USD. Yet that hasn't happened. The cryptocurrency has not only bearish drivers but bullish ones as well. Chief among the latter is persistent investor interest in products offered by specialized exchange?traded funds.

In March, net inflows into Bitcoin?focused ETFs totaled $1.1 billion. After four prior months of shrinking holdings, this was something of a ray of light. Furthermore, for the week ending April 3 ETF holdings rose by a net $22.3 million.

This process, together with activity by crypto treasuries building reserves, confirms a change in the structure of the digital?asset market. The relative weight of crypto whales is decreasing while the share of institutional investors is growing. Their increasing influence on BTC/USD will lead to market stabilization and lower volatility. Bitcoin is unlikely to soar as high or crash as fast as it once did. On the other hand, strong demand tied to portfolio diversification is assured.

Technically, on the daily chart, BTC/USD is mounting an attack on the fair value level of 70,300. A breakout followed by a sustained close above it would signal that Bitcoin is coming under the bulls' control and would be a buy trigger. Conversely, a rejection at that resistance would indicate buyer weakness and be a reason to consider short positions.