NOIDA (CoinChapter.com) — Bitcoin price has staged a modest recovery above $88,000 after plunging nearly 28% from its record high near $109,000 earlier this year. The pullback followed a wave of macroeconomic uncertainty in early March, including renewed concerns over U.S. tariff policy and weak global risk sentiment. However, on-chain data and policy developments continue to support Bitcoin’s long-term bullish thesis.
The rebound coincided with a shift in the Federal Reserve’s tone. Market expectations have started pricing in a return to quantitative easing by mid-2025, triggering renewed interest in risk assets, including BTC. Arthur Hayes, co-founder of BitMEX, suggested this liquidity pivot could push Bitcoin above $110,000 in the coming months. Meanwhile, the Trump administration has stepped up its pro-crypto stance. Recent executive actions include the formation of a Strategic Bitcoin Reserve and plans to position the U.S. as a global leader in digital asset regulation.
Still, caution lingers. Open interest in BTC futures remains elevated, and betting markets hint at a local top forming. While the long-term setup remains intact, Bitcoin’s near-term trajectory could remain volatile, driven by liquidity cycles, speculative leverage, and shifting U.S. policy narratives. Even the IMF may now be shifting its tone toward BTC—though with caveats.
IMF’s Bitcoin Pivot Signals Institutional Legitimacy, Not Full Embrace
Recent reports suggest the International Monetary Fund may be gradually warming up to Bitcoin, shifting away from its historically cautious stance. At the core of this narrative is the IMF’s updated Balance of Payments Manual (BPM7), released in March 2025, which formally classifies Bitcoin as a “non-produced nonfinancial asset”—a category traditionally reserved for commodities like gold. While this isn’t an explicit endorsement, it marks a technical shift in how the IMF sees the prime crypto within the global economic system.
This development has sparked speculation that the IMF may consider including Bitcoin in its Special Drawing Rights (SDR) basket, currently composed of five fiat currencies. However, such a move would break precedent, as the SDR has never included non-currency assets. The BPM7 update does not mention SDR adjustments, and no official IMF statement confirms reserve asset inclusion. Still, the classification of Bitcoin as a store-of-value asset aligns with the growing narrative of BTC as “digital gold.”
The timing is noteworthy, especially given the IMF’s earlier pressure on El Salvador to unwind its Bitcoin holdings during a $1.4 billion loan negotiation. The apparent absence of fallout from El Salvador’s Bitcoin strategy may influence a softer IMF tone. While the crypto community has welcomed the BPM7 update as bullish, the lack of direct confirmation leaves room for caution. Ultimately, the IMF’s updated framework lends credibility to Bitcoin’s macroeconomic role but falls short of signaling full institutional adoption.
Long-Term Holders Still Confident Despite BTC Price Drop
Recent on-chain data supports a structurally bullish case for Bitcoin despite its cooling price action since Feb. 2025. The realized price chart shows Bitcoin continues to trade comfortably above its realized price, currently near the $36,000–$38,000 range.
Historically, this gap reflects a market environment where most holders remain in profit, suggesting the broader market is still not in a panic or capitulation phase. This supports the argument that the recent dip is corrective, not a breakdown of a long-term bullish structure.
The Average Coin Dormancy chart reinforces this view. While there have been occasional spikes—particularly in February 2025—dormancy levels have stayed relatively low overall. Dormancy reflects the average age of coins being spent, so low levels typically indicate that long-term holders are sitting tight, not distributing. These conditions often precede renewed upside if demand returns.
The Exchange Netflow chart also reveals aggressive BTC outflows, aligning with the ETF-driven inflows and accumulation narrative. While net outflows have slowed more recently, inflows remain muted, indicating that selling pressure hasn’t escalated. The sustained low exchange balances create a supply squeeze scenario, which could amplify any upcoming demand shock.
Together, these three metrics signal a market in consolidation—not distribution. Bitcoin’s long-term trend remains intact unless exchange inflows spike or dormancy rises sharply.
