The cryptocurrency market is showing a weak outlook due to low liquidity inflows and fragility in investor confidence. According to the latest report published by Glassnode, Bitcoin (BTC) is facing downward risks due to decreasing participation across the market and ongoing selling pressure. The market is adopting a defensive stance due to low liquidity inflows and weakening investor confidence. Glassnode’s recent report highlights that Bitcoin (BTC) is confronted with downward risks due to low market participation and ongoing selling pressure. The report emphasizes that while some speculative transactions continue, the market’s overall direction remains uncertain. According to Glassnode’s analysis, fundamental market indicators point to a weak buying appetite for Bitcoin. While spot market volumes remain low, the continuous contract volume delta (CVD) turning positive does not seem sufficient to establish a strong trend. The market’s diminishing participation in recent weeks is noticeable, indicating cautious investor behavior on the buying side. Movements in Exchange-Traded Funds (ETFs) markets also support the current market trend. Outflows in Bitcoin ETFs show that institutional investors are inclined towards risk mitigation. Despite a slowdown in outflows, the decrease in transaction volumes indicates that major investors are acting more cautiously in the market. Uncertainty prevails in derivative markets. While open position numbers have balanced out after recent declines, funding rates remain well below long-term averages. This suggests a weakened demand for leveraged long positions. Additionally, there is a noticeable trend towards increased protection against downward risks in the options market. The 25 Delta Skew indicator reveals that investors are increasing hedge positions against price drops. On-chain data paints a more cautious picture of the current market state. The active address count, transfer volumes, and transaction fees in the Bitcoin network continue to decrease, indicating waning investor interest and capital inflows. Furthermore, the decline in the percentage of hot capital and the slowdown in realized capital growth signal a more defensive market stance. Negative signals are also evident in profitability metrics. While the profitable portion of Bitcoin supply is decreasing, the Net Unrealized Profit/Loss (NUPL) indicator suggests that investors are under increasing stress and the probability of forced selling is rising. Bitcoin remains exposed to risks. The general market outlook indicates that Bitcoin continues to struggle to move upward. The ongoing outflows from ETF markets, weakening on-chain fundamentals, and an increased demand for protection against downward risks in the options market suggest that Bitcoin may struggle to experience a strong rebound. If there is no significant increase in liquidity inflows, it is indicated that market conditions may continue the current downward trend.