Bitcoin has been in a $30,000-$35,000 range for almost a week at a time when some market participants are seeking out ether and other crypto to trade during the perceived doldrums.

Bitcoin’s price fell Tuesday, going as low as $30,875 around 15:00 UTC (10 a.m. ET) before coming back up, changing hands around $32,003. 

The drop occurred after the world’s oldest cryptocurrency reached nearly $35,000 on Monday, noted Constantine Kogan, partner at investment firm Wave Financial, who is also bearish on current market conditions. “I expect a decline to $29,000,” he told CoinDesk. “Apparently some of the holders and whales sold off their positions.”

Kogan noted some positive news this week that didn’t move the bitcoin market much. “Marathon has invested $150 million in bitcoin and intends to become the largest miner in the world,” he said. “Crypto funds are raising records, but there was no growth at the same time.” 

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The last time bitcoin was over $35,000 was almost a week ago on Jan. 20, according to CoinDesk 20 data.

“Many crypto natives and macro traders were anticipating a ~30% pullback off the all-time high from two weeks ago,” noted Brian Mosoff, chief executive officer for investment firm Ether Capital. “Now that it seems to have stabilized in the low $30,000s, traders are treating this as an opportunity to lever up and go long ahead of the next leg up.” 

Tuesday looked like a fairly priced day for long bitcoin leverage, as funding rates dipped a bit from Monday. That was a change from the excitement over the past 90 days, when margin rates could go as over 0.2% on some venues during the crazy price run-up to Jan. 10’s all-time high of $40,986.

Some are using bitcoin’s valuation relative to other cryptocurrencies as a signal for what’s ahead in the market. 

“I have a strong sentiment towards ether as a leading indicator for an upcoming alt season,” Global Digital Asset Chief Operating Officer Zachary Friedman told CoinDesk, referring to market conditions that favor “alts” or alternative cryptocurrencies. 

Friedman pointed out that bitcoin’s dominance, its share as a percentage of the total crypto market cap, is falling. Indeed, since the start of 2021, bitcoin dominance has fallen more than 10%.

“BTC dominance is dropping as profits are redistributed and ETH sitting just near its all-time high presents an immediate opportunity for new market entrants to diversify their holdings and seek additional yields,” Friedman added.

Ether (ETH), the second-largest cryptocurrency by market capitalization, was down Tuesday trading around $1,340 and slipping 2.2% in 24 hours as of 21:00 UTC (4:00 p.m. ET).

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On Monday the amount of bitcoin held in decentralized finance, or DeFi, crossed back over 40,000 BTC for the first time since mid-December. As of press time, 42,604 BTC were “locked” in DeFi, which investors do to obtain a “yield” in exchange for providing liquidity.

Ether Capital’s Mosoff says the rotation back into DeFi is simply investors chasing juicier opportunities as the market for bitcoin seems to be in a lull.

“Holders are anticipating ‘alt season’, and want to use their bitcoin to leverage additional exposure to other opportunities within the crypto space, whether it be DeFi tokens or other layer 1s such as Ethereum, Polkadot, Solana, NEAR, etc.,” Mosoff said. “Many of these projects have a lot of momentum at the moment and are well positioned for investor participation.”

Digital assets on the CoinDesk 20 are mostly red Tuesday. Notable winners as of 21:00 UTC (4:00 p.m. ET):

Notable losers:

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