The potential of an “economic nuclear war” and macroeconomic uncertainty has triggered heightened volatility and a rapid sell-off across crypto assets and the broader financial markets. Bitcoin has dropped by 9%, ETH/USD has dropped by 21%, and XRP has dropped by 15% over the past 7 days.
However, a closer look at market data reveals that all is not dark and gloomy like surface-level price actions suggests.
Capital Inflows Defy Broader Market Sentiment
According to data from DeFILlama, despite a general market pullback, several top-tier exchanges recorded positive monthly inflow in March and over the past week. Binance led the way with net inflows of $3.862B, while Bybit recorded $3.143B. MEXC recorded a 12% month-over-month increase in net inflow to $1.791B. Data from DeFi lama also highlight steady DEX volume, with total 24H volume surpassing $11 billion for the first time since March 11th.
Image credit: DeFiLlama
Inflow data over the last week reveals that despite the escalation of trade disputes and major sell-offs across all financial markets, major CEXs continue to record net inflows with Binance, Bybit, and MEXC leading the pack with $836.25M, $528.34M, and $75.17 million, respectively.
BTC and USDT Movements Hint at market repositioning not capitulation
Bitcoin has continued to show sustained resilience to the short-term shock the tariff situation triggers. Contrasting its reaction during past crises like the 2020 coronavirus financial market crash that saw BTC lose 50% of its value in just 2 days, BTC dropped 8% in the past 7 days despite increased volatility and sell-offs across the financial markets. Cryptoquant reported a huge spike in Bitcoin inflows to CEXs, with almost 60,000 BTC deposited on the 7th of April, 2025, in contrast to previous days, when inflows remained within the 15,000-40,000 BTC range.
Image credit: CryptoQuant
While at first glance this might seem like an increase in selling pressure, the context is much more complex because such inflow could be a result of technical wallet rebalancing or over-the-counter (OTC) trades rather than market exits. Similar instances on March 13th and March 28 did not result in significant price drops.
Data from Glassnode indicates that short-term holders continue to accumulate Bitcoin while long-term holders now control a record-high of over 13.5 million BTC.
Image credit: Glassnode
These metrics highlight the strong conviction and investor confidence in Bitcoin’s potential from both new and long-term investors despite the unstable market conditions and correction in financial markets. Stabelecoin movements further depict the subtle turn in market behaviour as nearly $2 billion USDT were moved to CEXs on the 7th of April.
Image credit: CryptoQuant
Stablecoin inflows often indicate that the market is preparing for an upward movement as investors await clarity to deploy capital into promising assets and buy the dip.
Future market outlook
While price action and market performance continue to paint a cautious picture, exchange and on-chain data suggest the market is in a more strategic phase where investors are seeking market entry opportunities. Despite short-term volatility, the long-term outlook shows that the market is repositioning and gearing up for another phase of the bull run.
Positive outcomes, such as a potential interest rate cut and resolutions in global trade, may prompt investors to shift from a capital-preserving and risk-averse strategy to a bolder investment approach. This change could lead to increased capital flow into digital assets and potentially trigger an upward reversal as early as May, provided that macroeconomic conditions stabilize.