- Bitcoin’s demand dropped from over 200000 BTC in early 2024 to -200000 BTC by March 2025 amid rising supply.
- A sharp $102 million liquidation event favoured bulls as short positions were wiped out 1533% more than long positions.
- The FHFA proposed a new rule to include Bitcoin in mortgage assessments, signaling a shift in financial asset evaluation.
In June 2025, demand for Bitcoin declined substantially following its recovery in May. Data shows that in January-April 2024, Bitcoin’s demand climbed above 200,000 BTC, as its price surged from $40,000 to over $70,000. But it reversed from late 2024 through March 2025 when demand dropped below -200,000 BTC This drop was accompanied by a price adjustment that was below 60K.
However, Apparent Demand is the metric that shows the difference between the interest of new buyers and the amount of coins put in circulation. These consist of newly mined Bitcoin and a circulating supply of coins with long-term holders (LTHs) selling back to circulation. A negative reading indicates the excess supply, which is the case now.
Source: Cryptoquant
The current supply outweighs the demand because the mining is ongoing, and LTHs sell at a profit. These long-term holders are usually considered experienced market participants. Their selling activity has carried a lot of pressure in the market, presenting a weak market situation, particularly in the absence of relative activity by the buyers. The current conditions reflect uncertainty over Bitcoin’s price direction in the short term.
Short Liquidations Dominate as Bulls Take Control
Meanwhile, the market has experienced an unusually large liquidation imbalance. According to data provided by Coinglass, Bitcoin had a total liquidation amount of $102.35 million during a single session. Out of this amount, $95.96 million came from short positions, while long liquidations totalled only $6.38 million.
Moreover, this sharp contrast created a 1533% bias towards an imbalance on long positions. In numerical terms, shorts were liquidated at a rate 15 times greater than longs. However, data analysts revealed that the bulls were heavily preferred in this momentum. This type of liquidation pattern normally comes after sharp changes in price levels, which compels traders with leveraged short positions to sell.
The squeeze is steep on shorts, showing the market’s current bias. Despite the low demand, according to the supply metrics, traders holding short positions against Bitcoin have recorded huge losses. This result implies a setting with temporary bull momentum despite the generally poor demand.
FHFA Weighs Bitcoin in Mortgage Qualification Rules
The Federal Housing Finance Agency (FHFA) introduced a new proposal whereby Bitcoin will be utilised in mortgage valuations. The agency affirmed that it will research how to include cryptocurrency holdings in the assessment of mortgage eligibility. The step can be considered a shift in the treatment of digital assets by U.S. financial regulators.
Commenting on the proposal, Bill Pulte indicated that the intention is to ascertain the implications of crypto assets on mortgage qualification. The new proposal would enable them to include their Bitcoins and other digital possessions among their financial assets, implying that potential borrowers would be able to submit the crypto portfolios without having to convert them into fiat money.
Furthermore, in case of implementation, such a change can introduce cryptocurrency to formal financial assessments, especially within the housing market. The fact that the FHFA made a choice aligns with the wider interest in perceiving digital wealth in traditional finance systems. Crypto assets have, until this time, existed largely beyond mainstream credit evaluations.
