The crypto market is frozen due to fear, but the flow of money is still pouring into Bitcoin.

The capital flowing into the crypto market has fallen sharply by over 70% in just two weeks, from 8.2 billion USD on April 4 to only 2.38 billion USD on April 18.

This significant fall reflects the cautious wave of investors in the context of market volatility and increasing macroeconomic pressures.

The sudden fall signals a change in risk appetite, as both retail and institutional investors reduce their exposure to volatile assets.

Although the market has maintained an upward trend at the beginning of the year, current conditions indicate that participants are reassessing their positions to respond to the broader economic environment.

Source: Ali_Charts## Why is fear dominating the crypto market

Of course, the data on sentiment is showing a change in behavior. The Fear and Greed Index remains stable at 33, in the "Fear" zone.

This level has remained unchanged for several weeks, fluctuating around 32 last week and 31 last month. Therefore, the market is psychologically stuck, with buyers reluctant to participate strongly.

In the past, prolonged periods of fear often preceded strong recoveries and deeper corrections.

However, the lack of volatility in sentiment indicates hesitation rather than panic, suggesting that participants are waiting for stronger macro signals or prices before making a decisive move.

Source: CoinMarketCap## The fear of inflation weighs heavily on confidence in crypto

Moreover, macroeconomic pressures are increasing. According to recent data, one-year inflation expectations soared by 1.7 percentage points in April, reaching 6.7% – the highest level since 1981.

This is the fourth consecutive monthly increase, with inflation expectations rising a total of 4.1 percentage points since November 2024.

Furthermore, the 5-year inflation expectations are currently at 4.4%, the highest level since June 1991. At the same time, consumer sentiment has dropped to the second-lowest level ever recorded.

Together, these numbers indicate a state of instability. And of course, cryptocurrencies, which are considered a type of high-risk asset, have had to endure increasing fear.

Can ETF capital flow prevent the retreat?

However, there is still a silver lining amidst the gloom. On April 17 alone, Bitcoin ETF funds recorded a net inflow of 107 million USD, bringing the total monthly amount to 156 million USD.

In fact, over the past three months, the net ETF inflow has surpassed 1 billion USD, indicating that institutional investors are not completely leaving the crypto space.

While the flow of capital into Ethereum ETFs has remained relatively flat, this divergence indicates that Bitcoin is considered a safer asset.

In addition, continuous ETF capital flows can provide a certain level of stability to the market and prevent panic-induced capitulation in the short term.

Source: CoinMarketCap## Where will the crypto market go next?

The capital flow has fallen sharply and the persistent fear signals that sentiment is becoming increasingly cautious. However, the stable capital flow from institutions through ETFs shows that investors are not giving up on the crypto market.

Instead, this appears to be a short-term reset driven by macro fears rather than a structural collapse. If inflation expectations stabilize and sentiment improves, the crypto market may find momentum for a new rally.

You can see the BTC price here.

Disclaimer: This article is for informational purposes only and is not investment advice. Investors should do their own research before making any decisions. We are not responsible for your investment decisions.

Viet Cuong