Bitcoin has recently declined further below the $100,000 threshold, primarily influenced by a new surge of risk aversion and a significant selloff in tech stocks that has rekindled concerns on Wall Street. The digital currency experienced a drop of as much as 3.9%, reaching a price of $97,956, marking a downturn that has erased over $450 billion in value since early October. Key supporters of the cryptocurrency market—such as large investment funds, ETF allocators, and corporate treasuries—have retreated, removing crucial support that had underpinned this year’s price rally and signaling a shift toward increased market instability.
According to analysts at 10x Research, the crypto market has officially entered a bear phase. They cite declining ETF inflows, continued sell-off from long-term holders, and limited engagement from retail investors as indicators of weakening market health. Their models indicated this transition in mid-October, suggesting a persistent slump in market sentiment. The firm’s analysis now identifies $93,000 as a critical support level.
Market dynamics are further complicated by heavy spot selling and corporate hedging activities, as noted by Jake Ostrovskis, head of OTC trading at Wintermute. He mentioned that traders are largely avoiding altcoins, leading to a heightened correlation between cryptocurrency and traditional asset classes. This correlation has exacerbated the recent downturn in prices.
The weakening of Bitcoin’s value comes during a period of volatility in global markets. A momentary uptick in U.S. equities earlier in the week, attributed to the conclusion of a government shutdown, has diminished. Traders are now re-evaluating their expectations regarding potential rate cuts from the Federal Reserve, which is putting additional downward pressure on growth assets, including cryptocurrencies and tech stocks.
The fallout is also evident in crypto-related equities. Shares of Strategy Inc.—a stock often seen as a benchmark for retail traders seeking Bitcoin exposure—have taken a significant hit in recent weeks. The company’s previously robust net asset value premium has nearly disappeared, leading to a substantial loss of investor capital.
In the realm of derivatives, there has been a marked increase in demand for protective options. Data from the Coinbase-owned crypto exchange Deribit reveals that interest has surged in put options below the $100,000 mark, with the most activity centered around strikes at $90,000 and $95,000.
Despite Bitcoin’s current situation, it remains approximately 5% higher year-to-date and has increased by over 40% since the U.S. election in 2024. However, recent momentum has notably slowed, and institutional appetite appears to be diminishing. The downturn began early in October when nearly $19 billion in crypto leverage was liquidated within a single day, an event that significantly impacted sentiment across the market.
While predicting a bottom remains challenging, 10x Research reflects on historical patterns to quantify current risks. Previous bear markets in summer 2024 and early 2025 saw declines ranging from 30% to 40%, and Bitcoin is currently down more than 20% from its peak in 2025, with scant indicators of a resilient recovery. 10x highlighted that Bitcoin’s failure to exceed the long-term moving average is a robust signal of diminishing market momentum, reinforcing their assessment that Bitcoin and several associated assets are entrenched in a bear market.
