Glassnode: BTC has broken below key on-chain valuation levels and liquidity is tight, with support potentially looking towards $54,900

According to The Block, on-chain analytics firm Glassnode has pointed out that Bitcoin has fallen below the "True Market Mean," which historically serves as a dividing line between expansion and contraction cycles. The current structural support level below may look towards $54,900.

Additionally, the net flow of the U.S. spot Bitcoin ETF has shifted back to continuous outflows, weakening the previously supportive marginal demand. In the derivatives market, panic sentiment has eased somewhat, but has not turned optimistic. Implied volatility has retreated from high levels, indicating that traders are unwinding their downside protection positions, but have not yet significantly established long positions.