Summary: Markus estimates that market-maker hedging accounts for about half of the $60 billion in ETF inflows; he sees BTC at $90,000 by year-end, while ETH underperforms as value flows to L2s.
On November 3–4, 10x Research founder Markus Thielen offered a series of views on a Cointelegraph podcast. The core point was not a price target, but a change in market structure.
The era of Bitcoin’s consecutive double-digit surges is over. Wall Street traders and profit-taking whales are reshaping the market: institutions sell call options after rallies, making the explosive price breakouts of earlier years less common. Thielen describes Bitcoin as now “rising quickly on news, then moving sideways while waiting for the next macro event.”
Half of the $60 billion wasn't directional buying
Thielen reviewed the roughly $60 billion in cumulative net inflows into U.S. spot Bitcoin ETFs and estimated that market makers may account for half of that. These firms hold ETF shares to hedge options trades, not to bet on Bitcoin going up.
His analysis is based on a review of Form 13F filings. The first wave of money into the ETFs also included retail investors buying through institutional channels and corporate vehicles, some of whom paid a significant premium to the underlying holdings.
$60 billion sounds like $60 billion reasons to be bullish. Break it down, though, and around half consists of market makers’ hedging positions, which aren’t directional bets on Bitcoin rising.
This doesn’t mean ETF capital is insignificant. It means that using the absolute net inflow figure to infer the “strength of institutional bullishness” will systematically overstate it. Thielen also leaves room for more inflows down the road: institutions such as sovereign wealth funds may still enter the market.
The $90,000 target depends on a pullback first
Thielen still expects Bitcoin to reach $90,000 by year-end, but says it could first fall to the $77,000–$79,000 range. Bitcoin closed October down 7.3% and is already trading near that range; after the Binance incident, it briefly touched around $76,100.
He likens the current pullback to the period in early 2023 before Bitcoin rebounded from around $20,000 to $30,000: investors are looking for the next dip and entry point, and “everyone feels like they missed out, so they all want to buy back in.”
The analogy has its limits. In early 2023, the macroeconomic backdrop was one of rate hikes nearing their end; today, markets are still waiting for the Fed’s next move. Goldman Sachs expects a second and final rate hike in December, putting the target range at 4% to 4.25%. Natixis has a similar view, but both firms attach a condition: inflation data must continue to improve. Whether Thielen’s $90,000 target comes to pass depends in part on whether rate hikes really do end in December.
Ethereum: value went to L2s, holders got none
Thielen is more bearish on Ethereum. He says he has been bearish on ETH for over a year, arguing that too much value has flowed to Layer 2 networks, while #ETH holders have not received enough in return.
There is a clear counterpart to this thesis in on-chain data. After the Dencun upgrade introduced blobs, L2 costs fell by 10 to 100 times, and activity continued to migrate to rollups. Ethereum mainnet’s daily burn fell from thousands of $ETH during busy periods to as few as 50 to 70; annualized net supply shifted from deflation after the Merge to modest inflation of around 0.2% to 0.8%. Fees no longer flow to the mainnet in significant amounts, nor are they burned, leaving holders with neither cash flow nor the support of a shrinking supply.
Ethereum made its network cheaper, and that was a success in itself. The problem is that making the network cheaper weakened ETH’s value-capture mechanism as an asset.
Thielen points to Hyperliquid as a comparison, arguing that Ethereum needs to strengthen the link between network usage and the financial interests of token holders. The comparison illustrates that if a protocol’s usage grows without a mechanism to pass value on to token holders, usage alone does not support the token’s valuation.
What to watch next
Whether the Fed really wraps up in December: Goldman Sachs and Natixis both expect a “final” hike, but make that outlook conditional on inflation. If rates are hiked again after December, Thielen’s path to $90,000 will take longer.
Whether the composition of ETF inflows changes: if market makers’ share of hedging declines and the proportion of directional buying rises, the strength of the “bullish signal” from ETF net inflows will change.
Whether Ethereum adjusts its value-capture mechanism: if low burn rates and modest supply growth persist, there will be no near-term evidence to counter Thielen’s bearish thesis.
Note: This content is for informational purposes only. Do your own research.