Could the Fed's concerns become a catalyst for the next major volatility of Bitcoin?

Bitcoin (BTC) is still considered a risky asset, but at the same time plays the role of a "safe haven" for investors whenever the economy fluctuates. Although retail investor trading activity is subdued, stable capital continues to flow into the market, helping the price of BTC remain around 122,000 USD, up 0.57% at the time of writing.

The question is: is a stronger breakout approaching? According to Coin Photon’s analysis, this possibility is entirely justified.

Economic instability could trigger a new price surge for Bitcoin

The unpredictable fluctuations in the macroeconomic landscape of the U.S. are inadvertently creating a favorable foundation for the breakout potential of Bitcoin.

This level of uncertainty is reflected in the Policy Interest Rate Uncertainty Index (KC PRU) of the Kansas Federal Reserve – a measure that assesses short-term fluctuations in the market, based on interest rate forecasts for the next year.

History shows that the KC PRU has a close correlation with the performance of Bitcoin. When this index declines, the market often becomes more stable, driving capital towards high-risk assets such as Bitcoin – the leading cryptocurrency with a market cap exceeding 2 trillion USD.

Source: AlphractalData from Alphractal indicates that the periods of significant decline in KC PRU, particularly during the 2019–2021 period, coincide with strong uptrends in BTC. Notably, a similar pattern is reoccurring from 2024 to early 2025, suggesting the possibility of a new growth cycle gradually forming.

This macro context further reinforces the accumulation trend on the chain ( that is increasing – a factor that often appears before significant market breakouts.

Institutional capital leads the wave of Bitcoin accumulation

The accumulation activity of Bitcoin is increasing significantly, led by institutional investors. According to data from SoSoValue, the platform tracking Bitcoin ETF capital flows, the market has witnessed 8 consecutive sessions recording inflows, with a total value reaching 2.5 billion USD.

In the most recent session, the inflow of capital reached 875 million USD – an impressive figure that demonstrates the strong confidence of institutions in the long-term potential of Bitcoin, as they view the current price as an attractive area to accumulate.

![])https://img-cdn.gateio.im/webp-social/moments-92f0ccb8ba97b4ab54cfbdee8177c4ad.webp(Source: SoSoValueConversely, retail investors remain more cautious. According to CoinGlass, the cash flow from this group only reached 47 million USD BTC during the same period. Although the scale is still modest, this figure still reflects an optimistic sentiment and an increasingly clear consensus with the positive trend of the market.

Long-term investors still hold the control

The accumulated capital flow in the market is showing persistent strength, clearly reinforced by the Accumulation/Distribution indicator, which currently records a volume of 12.57 billion – reflecting a high level of retained capital and strong confidence among investors.

To determine whether investors are inclined to hold or take profits, analysts also monitor the Binary Coin Days Destroyed )CDD( indicator. When this index reaches 1, it indicates that long-term investors are selling; conversely, a level of 0 shows that they are still committed to holding their assets.

![])https://img-cdn.gateio.im/webp-social/moments-81e086ae6900419cbe4ed5981ead8016.webp(Source: CryptoquantAlthough CDD mainly reflects the behavior of long-term holders, its impact spreads throughout the market: maintaining holding helps reinforce optimistic sentiment, while increased selling pressure makes the market more cautious.

At the time of writing, CDD fluctuates around 1, indicating that a portion of long-term investors has realized profits. However, institutions and individual investors are seizing the opportunity to buy in, reflecting a high level of confidence in the market – as new capital continues to flow strongly, along with the expectation that the price of Bitcoin still has significant growth potential in the near future.

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