Analyst Claims Wall Street Derivatives Are Driving Bitcoin’s Decline

Analyst says derivatives-driven synthetic supply now shapes Bitcoin prices more than on-chain demand.

Following an early-hours slip to $60k, Bitcoin rebounded above $68,000 as the Friday trading session progressed. Notably, this market drama followed the OG coin’s 13% drop on Thursday, which marked its largest daily decline since the 2022 crypto winter.

And while prices recovered, market analyst CryptoNobler warned that the decline reflects deeper structural issues. According to the market commentator, Wall Street’s growing influence on BTC price formation is affecting the coin’s price.

Bitcoin Down Nearly 50% From Peak as Derivatives Pressure Mounts

Thursday’s decline extended a broader selloff that has continued for months. As of now, Bitcoin sits almost 50% below its October peak of above $126,000. 

Even after Friday’s recovery, price action points toward Bitcoin’s worst weekly performance in nearly four years. On top of that, market-wide liquidations added pressure as strong selling activity pushed the price below key technical levels.

Market analyst CryptoNobler stressed that the OG crypto’s price is no longer set by supply-and-demand patterns. More so, the current trading reflects structural changes, not fear-driven selling.

CryptoNobler explained that the firstborn coin’s recent movement isn’t driven by retail activity or sentiment shifts. He added that underlying pressures have been building quietly for months and are now gaining speed.

According to the analysts, “most people are completely unaware what’s happening. And by the time it becomes obvious, the damage is already done. This move didn’t start today. It’s been building quietly under the surface for months. And now it’s accelerating.”

CryptoNobler argued that Bitcoin stopped functioning as a scarce asset once Wall Street-style instruments gained dominance. 

He said prices are no longer set mainly on-chain. Instead, derivatives markets now control valuation, a trend similar to that observed in precious metals, oil, and equities.

Observed derivatives trends have changed how BTC trades across global markets:

• Cash settled futures give exposure without owning the blue-chip asset.
• Perpetual swaps expand synthetic supply through leverage.
• Options create added claims linked to price moves.
• Investment vehicles have added paper exposure without direct ownership.

According to the analyst, these instruments allow synthetic Bitcoin supply to exceed real on-chain supply. And once synthetic claims overwhelm physical coins, price reacts more to positioning and liquidation flows than organic demand. In such a structure, scarcity loses influence over valuation.

CryptoNobler: BTC Market No Longer Functions Freely

CryptoNobler described the process as inventory manufacturing rather than speculation. He established that large players can create paper BTC, sell during rallies, and trigger liquidations. 

Afterwards, these entities buy back the asset at lower prices. Over time, repeating this cycle results in sharp declines followed by rapid rebounds. In such a derivatives-heavy market, price direction matters less than positioning and flow.

The market commentator also pointed to an underlying concern that centers on multiple claims tied to a single Bitcoin. A single coin can back ETF shares, futures contracts, perpetual swaps, and options exposure. 

At the same time, the coin can be used to broker loans and structured products. Such overlap resembles a fractional-reserve model rather than a free market, according to the analyst.

From CryptoNobler’s perspective, Bitcoin’s original thesis relied on fixed supply and limited rehypothecation. However, Wall Street participation changed both assumptions. While on-chain supply stays capped, pricing now reflects a much larger synthetic float. As derivatives volume grows, volatility may continue to rise, even during broader adoption phases.

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