Behind the mild rise of BTC, institutions and retail investors are playing two different games

BTC continues to rise on the first day of the new year. As of January 4th, it is trading at $91,330.90, up 1.34% in the past 24 hours. This increase seems steady, but behind the scenes, there is a deep divergence among market participants—institutional investors’ interest is waning, while retail investor sentiment is heating up. Meanwhile, the influx of global liquidity is reshaping asset allocation patterns.

Market Data and Status

From the data, BTC is currently fluctuating within a relatively stable range.

Over the past week, performance has been stronger, with a 7-day increase of 4.04%. However, the monthly change remains negative (down 1.04%), indicating that the recent rebound since the start of the year is a correction of earlier declines. On-chain data shows that about 20,000 BTC have left exchanges in the past week, typically indicating an increasing willingness for long-term holding.

True Signals of Market Divergence

Beneath the seemingly stable market, participant choices are clearly diverging.

Institutional enthusiasm cools vs. increasing global liquidity

The US spot Bitcoin ETF experienced its worst two months ever from November to December 2025, with net outflows totaling $4.57 billion. This directly reflects a declining interest among institutional investors in BTC. However, paradoxically, global ETF net inflows in 2025 reached a record high of $1.48 trillion. Although BlackRock’s IBIT had a negative annual return, this did not prevent global liquidity from shifting toward digital assets.

What does this mean? Institutions may be reassessing their BTC allocations, reallocating funds into other cryptocurrencies or traditional assets.

Retail sentiment heats up but with overheating risks

Social media data shows that early-year sentiment among crypto market participants is strong. However, analysts warn of a risk signal: if Bitcoin rapidly climbs to the $92,000 level, it could trigger a wave of FOMO among retail investors. Historical data suggests this often marks a market cycle peak, followed by declines.

Long-term holders are also worth watching—they have recently increased their loss realization. During periods of narrow price fluctuations, investor fatigue is evident. This indicates that market confidence may not be as firm as it appears.

Outlook for 2026: High Uncertainty

Predictions for BTC’s performance in 2026 show significant divergence.

Wide range of price forecasts

According to the latest reports, Forbes’ estimates for Bitcoin in 2026 range from $120,000 to $170,000. Analysts from Tom Lee, Standard Chartered, and Bernstein are generally bullish. But these are baseline forecasts—options markets reflect even greater uncertainty, with possible prices at year-end split into two extremes: $50,000 or $250,000, each with a 50% probability.

This extreme divergence in pricing indicates that market consensus on BTC’s future has completely broken down.

Downside risks cannot be ignored

Despite bullish sentiments, downside risks remain. Market expectations suggest the current decline could be reduced to around 40%, and 2026 may turn out to be a year of consolidation. Many institutions agree that if macroeconomic conditions improve and institutional participation accelerates, the potential upside could reach $250,000 or higher. Conversely, risks of correction are also brewing.

Key Observations

On-chain data shows that 940,000 BTC are distributed across the $84K–$85K range, the largest cluster since 2020. This means many investors’ cost basis is near the current price. A decline could trigger a chain reaction of stop-losses. Technically, hidden divergence continues to develop on the 3-day moving average, suggesting upward momentum may be waning.

My personal view is that BTC is at a critical transitional phase. Liquidity rotation is changing asset allocation patterns, but declining institutional interest indicates differing opinions among market participants about the future trend. In the short term, $92,000 could be an important psychological level; whether it is broken will influence retail investor sentiment.

Summary

BTC’s moderate rise masks deep internal divergence. Institutional investors are cautiously adjusting their positions, while retail sentiment heats up. Meanwhile, the influx of global liquidity is changing the game. The outlook for 2026 is highly uncertain—forecasts of $120,000–$170,000 seem to reflect consensus, but options markets pricing in a 50/50 chance of year-end prices at $50,000 or $250,000 more accurately reveal market confusion. The key variables are how institutions deploy capital and how macroeconomic conditions evolve. In this context, investors should remain cautious, watch for overheating risks, and not overlook downside pressures.