Glassnode Report: Bitcoin Market Turns Fragile — Oversold RSI, Rising Funding Rates and Surge in Options Hedging

Glassnode’s Market Weekly highlights the Bitcoin market endured marked volatility last week: the spot RSI entered oversold territory, momentum softened, cumulative selling intensified, and trading volume remained steady yet lackluster — signaling insufficient buyer confidence.

In the derivatives arena, open interest in futures contracted, pointing to reduced leverage, while elevated funding payments reflected extended long positioning. The options market saw a modest uptick in open interest even as the volatility skew narrowed and the 25 Delta skew rose, underscoring demand for downside protection.

Taken together, on-chain metrics and market indicators suggest a shift toward a more fragile market structure: muted ETF flows, weakening on-chain demand, slowing capital inflows and compressed profitability. Near-term direction will depend on whether marginal liquidity returns to stabilize conditions or if heightened volatility drives deeper consolidation.