Bitcoin fell below $90,000 this week, a level it hasn’t reached in seven months, according to data. Traders watched nervously as the flagship moved around $90,700leaving it roughly 25% below the recent all-time high of just over $126,000 on October 6. Markets noted that a major liquidation event on October 10 is still reverberating through trading desks.
Analysts see a short-term low
According to an interview on CNBC, BitMine Chairman Tom Lee said that the October 10 liquidations and continued uncertainty over whether the US Federal Reserve will cut interest rates in December have caused press crypto.
He described signs of exhaustion among sellers and cited technical research indicating a bottom could emerge soon.
Matt Hougan, Chief Investment Officer of Bitwise Asset Management, shared a similar line of thought, calling current pricing a “generational opportunity” and urging longer-term investors to take note. He added that traders are nervous about the economy, high AI valuations and US President Donald Trump’s tariffs, which may have contributed to the selling.
Sales driven mainly by short-term holders
According to XWIN researchA study of on-chain measures found that short-term bonds did much of the heavy lifting during the recent decline.
The Short-Term Holder Spend Output Profit Ratio fell below 1 several times, indicating that many short-term holders sold at a loss. XWIN also said that coins under three months old made up the majority of the volume issued during the worst of the decline.
That pattern points to panic-driven exits by recent buyers rather than massive, late-cycle distribution by legacy holders.
At the same time, metrics such as number of mint days destroyed, realized profits, and long-term holder’s net position change recorded increased distribution by long-term holders since September, but XWIN argued that this behavior is more consistent with routine profit-taking during a bull run rather than calling off top sales.
The flow of ETFs and whales is adding pressure
Reports have indicated that exchange-traded fund outflows and heavy selling of whales have also contributed to the weakness, while rising geopolitical tensions have added an extra layer of risk.
Market participants described Bitcoin as an early mover that began to weaken before other risky assets, which some investors interpreted as a warning sign for broader markets.
Prospects depend on stocks and policies
Lee expects a recovery as stock prices rise later this year, saying a stronger stock market will likely lift Bitcoin to new highs before the end of the year.
Hougan agreed that a recovery could come quickly and that the current period offers an attractive entry point for investors who plan to hold their shares for 12 months or more.
Yet traders remain divided; Some see the recent data as a clear depletion, while others warn that macro events and policy decisions could push prices lower before confidence returns.
Featured image from Unsplash, chart from TradingView