Bitcoin market in 'lethargic condition' not seen since before US election, says K33

Bitcoin remains in a low-volatility regime, posting a modest 2% weekly loss as risk-averse traders drive down yields, volatility, and trading volumes to multi-month lows, according to K33 Research.

K33 Head of Research Vetle Lunde noted that while a pro-crypto Trump Administration is a long-term positive for bitcoin and the broader industry, short-term uncertainty is keeping market activity muted.

"Bitcoin metrics are softening across all corners of the market. Volumes, yields, options premiums, and ETF flows have moved to areas not seen since before the election," Lunde said in a report on Tuesday. "Alongside these lethargic conditions, volatilities have plunged to multi-month lows."

Lunde highlighted that 37% of the top 100 U.S. companies currently exhibit higher 30-day volatility than bitcoin —a level not seen since October 2023. However, he cautioned that such periods of low volatility rarely last long, and traders should brace for a sudden shift.

"An overall risk-averse sentiment suggests traders are prepared for downside volatility, while moderate leverage levels currently point toward less overhanging risks of liquidation cascades," Lunde said.

CME bitcoin futures indicate potential market shift

Lunde's analysis of CME Bitcoin Futures suggests that premiums have recently dropped below 5%, which he noted was a rare occurrence. When looking at data from 2021 to 2025, low premiums have generally coincided with weaker market performance—conditions likely influenced by the prolonged 2022 bear market.

In futures trading, the basis refers to the difference between the futures price and the spot price of an asset. A premium occurs when futures prices exceed spot prices, often signaling bullish sentiment, while a discount suggests bearish conditions.

Lunde emphasized that bitcoin tends to perform best in a strong basis regime and urged caution amid current market uncertainty.

"Given the current uncertainty, we advise caution until a clear directional signal emerges," said Lunde.