Bitcoin’s latest breakout is being driven by institutions and constant on-chain demand rather than speculation, according to new data from Glassnode.
In the Oct. 8 edition of its “The Week On-chain” newsletter, the analytics firm said bitcoin’s rise to a new all-time high near $126,000 earlier this week was driven by strong ETF inflows and a steady accumulation of smaller market participants.
The move pushed Bitcoin to discover new prices before consolidating near $122,500 on Wednesday.
ETF Demand Profitability
Glassnode said more than $2.2 billion flowed into US spot bitcoin ETFs in a single week, marking one of the strongest waves of institutional buying since April.
Those inflows reversed the slight declines seen in September and helped absorb much of the supply available on stock exchanges.
The firm noted that the fourth quarter has historically been the most favorable season for bitcoin, as professional investors often rebalance their portfolios toward riskier assets, such as cryptocurrencies and small-cap stocks.
Sustained demand for ETFs, he added, could continue to anchor prices as the end of the year approaches.
Smaller holders drive accumulation
On-chain data from Glassnode shows that mid-tier holders, or wallets containing between 10 and 1000 BTC, have been the main buyers behind the latest bullish leg.
These accounts have apparently steadily increased their balances, while larger whales have seen moderate gains, creating what the company described as a “more organic accumulation phase.”
Nearly 97% of the circulating supply is now in profit, a level that typically marks late-stage bull cycles but has yet to show signs of exhaustion.
The report highlighted the $117,000 to $120,000 zone as a key area of on-chain support, with approximately 190,000 BTC last traded there, a price range where new buyers can step in if markets pull back.
Leverage adds a note of caution
While Glassnode described market conditions as “robust but mature,” it warned that both futures open interest and funding rates have increased sharply. He noted that annualized funding is now above 8%, suggesting an accumulation of leveraged long positions that could increase short-term fragility.
Still, Glassnode argued that the gains made remain subdued compared to previous market highs, indicating that investors are rotating their holdings rather than rushing out.
A structurally strong market
Overall, Glassnode said bitcoin’s structure remains strong, supported by institutional demand, deep liquidity, and broad-based accumulation.
The firm concluded that as long as ETF inflows persist, bitcoin’s rally could extend further into the fourth quarter, reinforcing its position as the most structurally supported bull trend in years.
