In late July, the story of Bitcoin suddenly unfolded into two distinct yet intertwined risk lines: one side saw Wall Street funds quietly retreating, with the US Bitcoin spot ETF experiencing a net outflow of over $465 million on July 23 and 24, breaking a streak of seven consecutive trading days of net inflow. According to Jinse Finance citing market opinions, this was attributed to concerns over the Federal Reserve potentially raising interest rates overshadowing the optimism brought by the Clear Act; on the other side, the law enforcement narrative surrounding criminal assets rapidly heated up — Chen Zhi, founder of the Prince Group in Cambodia, was formally approved for arrest on July 6, approximately six months after being escorted back to the country. His story of building a cross-border telecom fraud network centered around the Jinbei Industrial Park, amassing enormous wealth through gambling and deceit, has been continually dissected by multiple media outlets. Some reports even described his net worth as several billion dollars and mentioned that the Bitcoin valued at around $15 billion, confiscated by the United States, is currently only supported by a single source and has yet to receive independent verification. Meanwhile, according to PANews’ report, on-chain analyst Axel Adler Jr pointed out based on the MVRV Z-Score that Bitcoin's valuation has fallen to a multi-year low, remaining in the undervalued range but has not dropped into negative territory, meaning the on-chain data has not yet provided a traditional "complete surrender" signal. Under the resonance of tightening macro interest rate expectations, on-chain undervaluation signals testing the lows yet unconfirmed market bottoms, and the continuous tightening of law enforcement against cross-border telecom fraud involving Bitcoin assets, Bitcoin is entering a phase highly sensitive to emotions, with narratives that could be rewritten at any time.
Two days of $465 million outflows: ETF sentiment takes a sharp turn
While on-chain indicators were still debating "whether a true bottom has been reached," traditional finance provided a starkly different feedback. According to Jinse Finance, on July 23 and 24, 2026, the US Bitcoin spot ETF recorded a net outflow of over $465 million within two days, directly ending the previously sustained seven trading days of "only inflows." Just a week prior, funds were steadily increasing allocations, and the narrative was centered around "a clearer regulatory framework, reduced risk in allocations," but within two days, it rapidly flipped to reduction and defensive positioning; this time point itself is a scale of emotional abrupt shifts.
The report cites market opinions stating that this round of outflows did not stem from any single project's negative news but rather the sudden amplification of concerns over the Federal Reserve potentially raising interest rates, overshadowing the institutional benefits anticipated from the Clear Act. For ETF funds that typically price risk based on interest rate curves and policy signals, Bitcoin is merely a part of the asset pool, and once the macro environment is perceived as tightening again, the previous optimism based on legislative progress will quickly be discounted. The short-term shift from continuous net inflows to significant net outflows suggests that the recent Bitcoin rebound is more a fragile risk preference repair rather than a solid fundamental repricing. In the current context (end of July), as subsequent price and funding data have yet to be disclosed, this scene at least reminds us that the direction of this funding line still heavily depends on traditional capital's acute sensitivity to macro interest rate and policy expectations.
MVRV tests the bottom but does not break zero: On-chain only gives half a bottom
If ETF subscriptions and redemptions are the votes of traditional funds, "the bottom" needs to find evidence more on-chain. The MVRV Z-Score indicator is used to answer whether Bitcoin is expensive or not: it compares the total "market value" and "realized value" across the network; historically, spikes in high positions often correspond to bubble phases, while deep dips, especially falling below zero, are usually viewed as a collective acknowledgment of losses by holders, market surrender, and a general timeframe for confirming long-term bottoms. Many investors tend to treat "falling below zero" as a vague but useful permit: it may not capture the absolute lowest point but at least avoids the most crowded moments of overvaluation.
According to PANews, on-chain analyst Axel Adler Jr recently assessed that Bitcoin's MVRV Z-Score has dropped to a low not seen in years but still remains in positive territory, not yet touching the negative zone widely recognized as "complete surrender" in the past. In his framework, the current state appears more as a clear undervaluation zone — the price has been pressed to the lower edge of most historical phases — rather than the ultimate bottom traditionally defined as "extreme panic." This on-chain image of "undervalued but not surrendered" just provides another picture for the ETF net outflows: on one side, short-term funds sensitive to interest rate expectations are hastily retreating, while on the other side, long-term positions' on-chain valuations appear cheap but have yet to see desperate sell-offs. The coexistence of the two implies that the current phase cannot simply be viewed as the conclusive bottom, nor can it be summarized as a high-risk zone where the bubble has not dissipated.
Emotional and valuation disconnect: Who is leading between bulls and bears
According to Jinse Finance, after maintaining net inflows for seven consecutive trading days, the US Bitcoin spot ETF suddenly recorded over $465 million in net outflows on July 23 and 24. This reversal in rhythm is seen by many institutions as a typical "emotional sudden brake": the same assets, the same regulatory framework, yet funds shifted from proactive allocation to concentrated withdrawal in just two days. Meanwhile, according to PANews, the on-chain picture provided by Axel Adler Jr based on the MVRV Z-Score is "undervalued but not surrendered" — valuations have compressed to multi-year lows but remain above zero, indicating that statistically speaking, prices are low, yet they haven’t reached positions of extreme panic and indiscriminate selling. One is an in-market product responding quickly to expectations of potential rate hikes by the Federal Reserve, while the other is a slowly reflecting on-chain indicator showing the cost and profit distribution of long-term holders. The overlap of these two signals with different time dimensions forms the currently fractured emotional structure in the Bitcoin market.
In an environment where macro interest rate expectations are once again dominant, traditional institutions pay more attention to the interest rate path over the next few quarters: the Clear Act briefly boosted the perception of "institutional benefits," but once worries about rate hikes retook narrative control, ETF fund withdrawals primarily reflect a repricing of interest rate risk rather than a complete denial of Bitcoin's technology or regulatory prospects. Conversely, on-chain long-term holders' decision coordinates are closer to the "valuation range" — the MVRV Z-Score remains above zero, signifying that most positions have not been forced to concentrate sell-off in the loss zone, thus turning the narrative support for bulls into "prices have returned to the undervaluation zone, true surrender has yet to appear." Bears then seize upon another logic: high interest rates weaken Bitcoin's narrative against inflation and regulatory risk, and the optimism brought by the Clear Act is undermined by the reality of monetary policy, where ETF bleeding is merely the first wave of this undermining. Existing materials do not provide insights into the holding structure, open contracts, or liquidation data, and the advantages for both bulls and bears can only be judged through this dislocation of emotions and valuations: whether the interest rate narrative continues to suppress prices, or whether the "undervalued but not surrendered" on-chain structure ultimately buys time for the bulls, this has yet to be clearly chosen by the market.
The black-gold empire of Jinbei Industrial Park: Chen Zhi's arrest and Bitcoin allegations
If the inflow and outflow of ETF funds on Wall Street forms a visible risk curve, then the story of Cambodia's Jinbei Industrial Park represents a more shadowy line. Multiple media investigations have portrayed Chen Zhi as the core figure of this black-gold empire — the founder of the Prince Group in Cambodia, who built a global telecom fraud and gambling network in Jinbei Industrial Park, described as "earning millions daily from the duke's position," converting countless funds from overseas victims into his assets through layers of call center operations, gambling platforms, and violent control. In this narrative, Bitcoin is not the "digital gold" countering inflation but one of the value carriers hidden behind the park and offshore structures.
After being escorted back to the country for about six months, public reports show that Chen Zhi was formally approved for arrest on July 6, 2026, with adjustments made to the charges, reducing the original charges of concealing and disguising criminal proceeds and adding new charges of copyright infringement and intentional injury, with specific legal grounds yet to be detailed. Externally, it presents a trajectory of transition from the "black-gold empire" to a complex criminal case. Some reports further exaggerate his wealth scale, claiming his net worth is several billion dollars and mentioning that the Bitcoin confiscated by the United States alone is valued at around $15 billion, though these figures currently have support from only a single source and lack independent cross-verification, resembling exaggerated coordinates in the case narrative rather than precise on-chain statistics that could be cited. Nonetheless, this case still reflects another facet of Bitcoin: beyond the inflows and outflows of ETF funds and on-chain valuation models, it is equally an asset involved in cross-border crimes that can be locked, traced, and confiscated, and this line of risk from regulation and criminal enforcement is reshaping the real situation of Bitcoin alongside market price risks.
From Wall Street to Jinbei Industrial Park: What to watch next for Bitcoin
In late July 2026, during the same time window, the US spot ETF experienced a sudden net outflow of over $465 million after seven consecutive trading days of net inflows, occurring alongside the on-chain MVRV Z-Score dropping to a multi-year low but still not breaking zero, while the narrative in the Jinbei Industrial Park reached a new phase following Chen Zhi's formal arrest approved on July 6. These two main lines depict the risks of Bitcoin as distinctly different yet intertwined realities. The story of Bitcoin is no longer simply a single label of "safe-haven asset" or "technological innovation"; it concurrently bears the Wall Street emotions driven by Federal Reserve interest rate expectations, the long-term holder status hints according to on-chain cycle models, and the criminal governance practices surrounding cross-border telecom fraud and crypto assets. Looking ahead, the variables that could genuinely change the shapes of these two risk lines are concentrated in four directions: first, how the Federal Reserve's subsequent interest rate path adjusts current worry sentiments; second, whether the rhythm of inflows and outflows from the US Bitcoin spot ETF will continue the withdrawal pattern observed in late July or revert back to net buying; third, whether the MVRV Z-Score will further approach or even drop below zero, signifying a transition from "undervalued" to a comprehensive surrender on-chain; and fourth, after the Chen Zhi case enters the prosecution phase, whether countries will adopt a more stringent regulatory and judicial stance toward similar parks and Bitcoin-related wealth. These variables collectively determine the upcoming risk pricing method for Bitcoin across price, narrative, and compliance dimensions.
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