[Analysis] "Is Bitcoin's Summer Correction Ending... Hopes Rise on Institutional Inflows and Seasonal Strength"

Bitcoin (BTC) has recently shown signs of breaking out above the upper end of its trading range, and some analysts now suggest the summer correction phase may be drawing to a close.

On the 4th, digital asset research firm Matrixport released a research report stating, "Bitcoin is displaying a trend toward breaking above major trendline resistance, and the summer correction could be ending."

First, as Bitcoin’s volatility gradually decreases, the possibility of additional institutional capital inflows is being raised. Matrixport explained, "Bitcoin's realized volatility has dropped to its lowest level in years, indicating a fundamental change in market structure. Low volatility is more than just a maturity indicator; it also provides a trigger for institutional money, previously held back by risk regulations, to enter the market."

According to the report, since April, inflows into Bitcoin ETFs have reached around $14 billion. This is about $4 billion higher than the expected spot inflows attributable to the rise in Bitcoin’s price over the same period. Matrixport evaluated, "These inflows are primarily for asset allocation purposes rather than speculative reasons and represent a positive signal for the market structure."

However, there is a cautious analysis that overall market capital efficiency is somewhat slowing. The report forecasts, "For 2025, the annualized capital inflow trend is expected to be about $291 billion, which is a decrease compared to last year’s peak of $377 billion." Therefore, "More capital will be required than before to push up Bitcoin’s market capitalization."

Additionally, the seasonal pattern in July warrants attention. According to the report, over the past 10 years, Bitcoin has posted gains in July 7 out of 10 times, with an average return of 9.1%. Conversely, August and September have generally seen weaker performance with decreased trading volume and macroeconomic uncertainty.

Matrixport predicted, "This July could also see a final upward move, buoyed by seasonal strength, expectations of interest rate cuts, optimism for earnings season, and a strong U.S. stock market." However, they added, "If retail inflows or new capital are limited, the rally may be capped at $116,000, but if buying strength continues, there is potential to break through $120,000."