In the Bitcoin market, money that moved into stablecoins is showing signs of returning to Bitcoin.

On April 11, blockchain outlet BeInCrypto reported that both on-chain indicators and futures positions suggest investor sentiment is gradually shifting.

The key is a change in fund flows between stablecoins and Bitcoin. Analyst Darkfost (다크포스트) pointed to Bitcoin's realised market cap falling to as low as minus $28.7 billion at the end of February, while stablecoin market capitalisation rose above $6 billion. That means investors at the time responded defensively by moving funds into stablecoins, which have the characteristics of safe-haven assets, rather than leaving the market altogether.

Darkfost said this stretch was the first rotation observed since the previous bear market. He said the setup at the time showed a "clear intention" by investors to protect capital.

The trend has since shifted again. Bitcoin's realised market cap recovered to around minus $3 billion, while changes in stablecoin market capitalisation fell to minus $1 billion. That underpins interpretations that money that had stayed on the sidelines is flowing back into Bitcoin.

The derivatives market is sending similar signals. Analyst Michaël van de Poppe (Michaël van de Poppe) said speculative players have now returned to net long positions in Bitcoin. He said the trend is very similar to the pattern seen just before a major breakout in 2023. He added that commercial participants remain net short, creating an opposite structure to speculative players.

He also said Bitcoin could move into the $80,000 to $85,000 range. He did not draw a firm conclusion on direction. "This data does not guarantee a major upside breakout," he said, placing more weight on the possibility of greater volatility because the market has rejected further declines even as it stayed range-bound for two months.

The timing of the change is also drawing attention. Darkfost said the shift in fund flows began when uncertainty over Iran-related conflict reached its peak. He said some investors appear to have started viewing Bitcoin as a hedge against inflation and economic risks that could arise from the situation.

Prices also moved in line with that trend. Bitcoin has risen more than 10 percent since the war began. The rebound is still not large, but some see the Bitcoin upswing continuing if the rotation persists.

It is still too early to say the market has secured a strong direction. On-chain and futures indicators point to the possibility of renewed inflows, while also signalling the potential for increased volatility. In this environment, the Bitcoin market has entered a phase that will determine whether stablecoin sidelined cash leads to an actual trend reversal or remains a short-term rebound.

We are starting to observe a shift in investor behavior on Bitcoin. This can be seen through the rotation of liquidity that has recently begun to take place. ▶︎ At the end of February, Bitcoin’s realized cap reached an extreme low of -$28.7B, while at the same time,… pic.twitter.com/wNBivHpXWK