jakiro
Shaw, Bitcoin Vision
Rather than easing the downward trend that started last weekend, the crypto market has intensified this week.Starting early this morning, Bitcoin fell significantly again, briefly falling below the $90,000 mark, with a 24-hour drop of more than 5%; Ethereum fell below the important support mark of $3,000, with a 24-hour drop of more than 4.4%.Coingecko data shows that the total market value of cryptocurrency fell to US$3.21 trillion, a 24-hour decrease of 2.2%, and a 24-hour trading volume of US$214.53 billion.Data shows that in the past 24 hours, the entire network liquidated $891 million, of which long orders liquidated $609 million and short orders liquidated $282 million.Among them, the liquidation of BTC was US$459 million and the liquidation of ETH was US$168 million.
The continued downturn in crypto assets has almost exhausted investor confidence in the near future, and panic continues to deepen.What factors continue to put pressure on the market?Are cryptocurrencies already in a bear market?How to interpret it?
1. Cryptocurrencies continue their downward trend, with no signs of rebound yet
Starting early this morning, Bitcoin fell sharply again, briefly falling below $90,000, with a 24-hour drop of more than 5%. The 50-day moving average also fell below the 200-day moving average, forming a “death cross” technical form.Ethereum fell below the important support level of $3,000, once touching $2,946, a 24-hour drop of more than 4.4%.
Coingecko data shows that the total market value of cryptocurrency fell to US$3.21 trillion, a 24-hour decrease of 2.2%, and a 24-hour trading volume of US$214.53 billion.Coinglass data shows that in the past 24 hours, the entire network was liquidated to US$891 million, and more than 172,000 people were liquidated, of which long orders were liquidated to US$609 million and short orders were liquidated to US$282 million.The liquidation of BTC was US$459 million, and the liquidation of ETH was US$168 million.
Cryptocurrencies continue to decline, and there are currently no obvious signs of rebound. Market panic is intensifying, which continues to consume investor confidence.
2. Macroeconomic uncertainty and decline in core assets stimulate cryptocurrency
This large-scale sell-off is not limited to crypto assets. Investors have sold off risky assets as concerns about the sustainability of the AI boom and economic prospects have intensified.This week, a series of important economic data delayed due to the U.S. government shutdown will be released; Nvidia will release its financial report, and its performance is regarded as a bellwether for AI chip demand.In addition, concerns about the private credit market have also surfaced.Market analysts say that the US$1.7 trillion private credit market is creating “junk loans” and compares them to subprime mortgages before the 2008 financial crisis, saying that “the next big financial market crisis will be private credit.”These have heightened investors’ caution as they await Nvidia’s earnings and key employment data.
Affected by the above factors, the S&P 500 Index and the Nasdaq Composite Index both closed below the 50-day moving average, breaking the longest consecutive winning streak since May this year.The Dow Jones Industrial Average experienced its worst three-day performance since April, closing down 1.2%, or 557 points, on Monday.The Nasdaq fell 0.8% and the S&P 500 fell 0.9%.Gold futures fell back to $4,068.30 per troy ounce.Spot gold prices fell to around the $4,000 level.
Currently, Bitcoin’s correlation with U.S. technology stocks has climbed to a rare high.Bitcoin’s 30-day correlation with the Nasdaq 100 reached approximately 0.80, the highest level since 2022 and the second-highest value in the past 10 years.Bitcoin’s 5-year correlation with the Nasdaq has reached 0.54.In contrast, Bitcoin’s correlation with cash and gold is essentially zero.Currently, Bitcoin’s market performance is getting closer and closer to that of leveraged technology stocks.
Therefore, the sharp decline in the crypto market is largely due to investor concerns about future macroeconomic uncertainty and the simultaneous stimulus impact of the decline in U.S. stocks.
3. The Federal Reserve’s “civil war” continues, and market expectations for interest rate cuts continue to decline.
The Federal Reserve’s “civil war” continues and has yet to reach a relatively unified opinion, causing the market’s expectations for an interest rate cut in December to continue to decline.Wall Street Journal reporter Nick Timiraos, “Fed’s mouthpiece”, pointed out that Fed officials face a challenge, that is, how to resolve differences on interest rates.The Fed is currently divided into two camps, one of which is more worried about inflation. The size of this group has recently expanded and includes four local Fed presidents with voting rights this year, as well as Fed Governor Barr.Another group of officials, including all three Trump-appointed Fed governors, are more worried about the labor market. They worry that their colleagues will overemphasize the dangers of persistently high inflation, leading to unnecessary risks of recession, and that they believe that high inflation is far away.Separately, Federal Reserve Governor Christopher Waller said on Monday that he supports another interest rate cut at the December meeting as he grows concerned about a sharp slowdown in the labor market and employment.Waller specifically stated that he would favor another 25 basis point rate cut.At the same time, he said price data suggested the tariffs would have no long-term impact on inflation.Another rate cut would be a risk management exercise.
According to CME’s “Fed Watch”: the probability that the Federal Reserve will cut interest rates by 25 basis points in December is 42.9%, and the probability of keeping interest rates unchanged is 57.1%.The probability that the Fed will cut interest rates by 25 basis points cumulatively by January next year is 48.2%, the probability of keeping interest rates unchanged is 35.6%, and the probability of cumulative interest rate cuts by 50 basis points is 16.1%.
The Federal Reserve’s “civil war” continues to escalate, differences are getting wider, and future policies are uncertain, causing market expectations to continue to fall and investors’ concerns to intensify.
4. ETF funds continue to experience net outflows and market liquidity is insufficient
The latest data from CoinShares shows that digital asset investment products suffered an outflow of up to $2 billion last week, setting a record for the largest weekly outflow since February this year.This is the third consecutive week of capital outflows, with the cumulative outflow reaching US$3.2 billion.Affected by the recent price decline, the total assets under management (AuM) of digital asset ETPs have fallen from a peak of $264 billion in early October to $191 billion, a drop of 27%.Bitcoin has borne the brunt of the negative sentiment, with outflows totaling $1.38 billion last week. The three consecutive weeks of outflows now account for 2% of its total assets under management.Ethereum is in even worse shape, with outflows reaching $689 million last week, accounting for 4% of its assets under management.Solana and XRP also experienced small outflows of $8.3 million and $15.5 million respectively.
SoSoValue data shows that the Bitcoin spot ETF had a net outflow of US$1.11 billion in a single week during last week’s trading day.The Bitcoin spot ETF with the largest net outflows in a single week last week was Blackrock ETF IBIT, with a weekly net outflow of US$532 million; followed by Grayscale Bitcoin Mini Trust ETF BTC, with a weekly net inflow of US$290 million.Farside Investors data shows that the Ethereum spot ETF had a total net outflow of US$728 million last week.
ETF funds continue to experience large net outflows, indicating that institutional investor funds are continuing to withdraw from the crypto market.Although DAT treasury companies such as Strategy and BitMine have been “buying dips” in crypto assets such as Bitcoin and Ethereum, as the market continues to slump, DAT treasury discounts and premium mechanisms have become ineffective, and they still cannot boost the overall crypto market trend.
5. Long-term holders continue to sell, and whales continue to short the market.
CryptoQuant data shows that long-term Bitcoin holders continue to significantly reduce their positions, selling a total of approximately 815,000 Bitcoins, the highest level since 2024.Continued selling pressure is having a downward impact on prices amid weakening demand.Glassnode data shows that long-term holders (addresses held for more than 155 days) are currently selling approximately 45,000 ETH per day, equivalent to approximately $140 million, which is the highest level since February 2021, indicating that bullish power has weakened.
In addition, Lookonchain monitors that a whale has a large short position of BTC, XRP and ZEC, with a total value of more than 190 million US dollars. The whale’s 40 times short BTC position is worth US$148 million, with an opening price of US$96,065.2 and a liquidation price of US$97,560.2; its 20 times short XRP position is worth US$27.3 million, with an opening price of US$2.225 and a liquidation price of US$2.5;The 10x short ZEC position is worth $20.6 million, with an opening price of $652 and a liquidation price of $775.According to OnchainLens monitoring, the 20-fold short position in Bitcoin held by a certain whale currently has a floating profit of more than US$15 million.The giant whale has made a cumulative profit of more than $41.7 million through multiple short-selling operations on Bitcoin.A certain whale continued to increase its short position on SOL with 20 times leverage.The position is currently worth US$53 million, with a floating profit of US$11.5 million.
Continuous selling by long-term holders has increased downward pressure on the crypto market, and whales continue to leverage contracts to short the market, which is also a blow to the spot price of cryptocurrencies.
6. Market interpretation
The continued downturn in the crypto market has amplified investor panic, and signs of a rebound have yet to appear.Has the market fallen into a bear market?Is now a good time to buy?When can I buy the bottom?Let’s take a look at what interpretations there are.
1. CryptoQuant CEO Ki Young Ju said, the current market correction is mainly due to the change of hands among long-term holders. Early Bitcoin holders are selling their chips to traditional financial institutions, and these institutions also tend to hold long-term.He recalled that the reason why the stage top was judged in advance earlier this year was because the “OG whales” were selling sharply at the time, but the current market structure has changed.He pointed out that ETFs, MicroStrategy and multiple new funding channels continue to bring incremental liquidity, and on-chain capital inflows remain strong. This round of corrections is mainly due to early whales pulling the market down.He emphasized that as sovereign funds, pension funds, multi-asset funds and corporate treasury continue to deploy, Bitcoin’s liquidity channels will be further expanded. As these capital channels continue to operate, traditional cycle theory is no longer applicable.
2. BitMEX co-founder Arthur Hayes said, “Bitcoin fell from $125,000 to a range near $90,000, while the S&P 500 and Nasdaq 100 indexes are still hovering at all-time highs, which leads me to conclude that a credit event may be brewing. This view is confirmed when I look at the decline in the USD Liquidity Index since July. If correct, the stock market could see a 10%–20% correction.At the same time, the 10-year U.S. Treasury yield is close to 5%, which will force the Federal Reserve, the Treasury, or other U.S. government agencies to urgently launch some kind of money printing program.During this period of weakness, Bitcoin may drop to $80,000 to $85,000.If the broader risk market collapses and the Federal Reserve and the Treasury Department accelerate money printing, Bitcoin may rush to $200,000 to $250,000 by the end of the year.”
3. Matrixport analysis said, the current market is in an obvious deleveraging stage, and the risk of maintaining high positions is rising.Ethereum’s open interest has fallen back by 50%, showing that leveraged funds are contracting rapidly.Against this backdrop, overall risk appetite is under pressure.Bitcoin range-bound liquidity may weaken further in the short term.The once highly crowded long futures positions have been basically cleared, and the pressure on the leverage side has been released in stages.The next thing to pay attention to is that ETF holdings are currently relatively concentrated; if the market continues to weaken, this part of the funds may have further needs to lighten their positions, thus bringing new liquidity pressure.
4. Tom Lee, Chairman of BitMine, issued a statement:, Bitcoin is a volatile asset.His company first introduced Bitcoin to clients in 2017, when the price was around $1,000.In the past 8.5 years, Bitcoin has experienced six declines of more than 50% and three declines of more than 75%.As of 2025, Bitcoin has risen 100 times compared to when it was first recommended.Tom Lee pointed out that to benefit from this 100-fold super cycle, investors must hold on at critical moments.He explained that cryptocurrency prices reflect huge expectations for the future, so doubts create volatility.Tom Lee believes that ETH is currently starting the same super cycle, but emphasizes that the upward path is not a straight line.
5. Metaplanet CEO Simon Gerovich wrote:, Bitcoin ETFs need to be supported by capital inflows, otherwise the number of Bitcoins held will never increase, and the number of Bitcoins held by Bitcoin treasury companies will never increase. Therefore, ETFs are a “static exposure” and the roles of the two are different. ETFs will not weaken the advantages of Bitcoin treasury companies.
6. Bloomberg ETF analyst Eric Balchunas said, Bitcoin rose by 122% last year, 5 times that of the S&P 500 Index and GLD. Has any Bitcoin holder complained?Has anyone ever thought “wait a minute, Bitcoin’s historical performance relative to risk assets suggests it shouldn’t have gone this high, that’s too bad!”?No, you all like this extra increase and enjoy double profits, so you got nothing this year, and the average increase still reached 50%.
7. CryptoQuant analyst CrazzyBlockk said, this sell-off looks more like a mid-cycle correction than the beginning of a full-blown bear market, as losses have not yet reached “capitulation selling” levels.Market uncertainty comes from changes in investor expectations for the Fed’s policy.
8. 10x Research analysis said, ETH has now fallen below the 7-day and 30-day moving averages, and the technical form is bearish, with a decline of 6.6% in the past week.At the same time, ETH ETF experienced a net outflow of over US$1.4 billion, and long-term holders of 3-10 years on the chain are selling at the fastest speed since 2021, creating additional supply pressure.
9. Analyst Adam Button said, since the “Tariff Day” lows, every time the market has declined, it has gradually stabilized and then started to buy the dip.Once the rally begins, momentum takes over.But that hasn’t been the case lately.The market has been moving in fits and starts since late October.Kinetic energy sometimes exists and sometimes disappears.Markets continue to spend two weeks pricing in the possibility of a rate cut in December.The current price action does not look good, and it is worth noting that there is no news event behind this decline.
