Bitcoin has undergone a critical resilience test.
The crypto king has definitively entered a bearish phase, falling below the historical price level of $90,000 and settling at $86,901.48 at the time of writing, according to CoinMarketCap.
While the key fact is price, the underlying causes point to deeper structural vulnerabilities within the market.
Two pressure factors caused this decline
Farzam Ehsani, CEO of VALR, highlighted the forces at play, noting that the drop below $90,000 was driven by the dual pressures of “rising interest yields and weekend liquidations.”
He said,
“Bitcoin’s drop below $90,000 is the result of a clash between the fragile market structure and the weak liquidity conditions observed this weekend”
Ehsani also noted:
“Pressure on the markets increased as the order book was limited and the market lacked sufficient depth to withstand a new macroeconomic liquidity shock.”
This lack of sufficient depth means that the market cannot withstand even a small liquidity shock that the current Bitcoin [BTC] The market structure is very sensitive to external financial shocks.
The MSCI index dilemma
Another, deeper structural threat now weighing on Bitcoin is MSCI’s upcoming decision on its global index rules.
The proposal would exclude companies that hold more than half of their assets in crypto, which would have a direct impact on large corporate BTC holders such as Strategy, Marathon, Riot, Metaplanet and American Bitcoin.
Together, these companies control more than $137 billion in digital assets, which amounts to about 5% of all Bitcoin.
Because passive index funds must mirror the MSCI indices, any exclusion could trigger forced selling of the shares of these companies.
This may even prompt companies to shed some of their BTC reserves to adjust their balance sheets.
Investors are already preparing for this possibility and pricing in the risk of a sharp liquidity outflow.
But if MSCI rules aggressively, the entire corporate-backed Bitcoin sector could be valued lower, which could put significant downward pressure on BTC itself.
The fate of the big companies, especially Strategy, is therefore closely linked to the direct price of Bitcoin.
Strategy and the bear market correlation
So far, November has delivered Bitcoin’s worst monthly performance since 2018, further increasing parallels with previous bear markets.
Ehsani added,
“This uncertainty makes it difficult to identify a clear change in direction as the market continues to fluctuate between forced deleveraging and muted dip buying, with neither side able to maintain momentum.”
This highlights that the immediate future of the market is now a high-stakes waiting game.
If institutional and macroeconomic pressures persist, Bitcoin’s downturn could extend to between $60,000 and $65,000.
Ironically, such a decline could set the stage for a strong recovery, as major institutions and Strategy competitors could view these levels as key accumulation zones.
Still, any recovery will take time – the market’s recent volatility indicates that a consolidation phase is likely before momentum returns.
Echoing similar sentiments, another analyst weighs in
Also Juan Perez, Director of Trading at Monex USA noted,
“Bitcoin appears to be suffering from waning enthusiasm in both the crypto and tech worlds.”
Perez added,
“The negativity at the moment seems to be related to growing concerns about increased market concentration and the questionable sustainability of overall growth in that sector given infrastructure challenges, and less cooperation in global trade.”
That said, the unwinding of carry trading in the yen due to Japan’s shifting monetary policy is also one of the main reasons behind this decline.
So whether BTC stabilizes or goes deeper depends entirely on how the market absorbs these increasing institutional and macro pressures.
Final thoughts
- Bitcoin’s near-term fate is strongly tied to regulatory actions and outcomes.
- Maintaining the structural support at $88,000 is crucial for Bitcoin.