Despite Bitcoin’s remarkable recovery to $75,000 and resilience during the West Asian crisis, its medium-term prospects were still uncertain.
According to crypto options analytics firm Amberdata, the current recovery has been based on structurally weaker liquidity compared to pre-October levels.
As such, the market was vulnerable and prone to excessive moves (liquidation cascades), especially downwards when selling pressure reemerges.
Bitcoin’s downside risk is lurking
The company cited order book liquidity, which follows the orders of market makers or the ability to execute trades without massive slippages or price movements.
When liquidity in the order book is scarce (market makers become cautious), even small orders can strongly influence the price. But the thick liquidity helps absorb the flows effortlessly.
According to the attached diagram, BTCs During the May to October 2025 rally, liquidity rose from $21 million to a peak of $45 million (thick liquidity).
During the October crash, liquidity fell 46% within hours, from $48 million to $26 million, as market makers pulled out during the liquidation cascade. This amplified the sharp drop from $122,000 to less than $100,000.
Now, the recent recovery has pushed order book liquidity above $30 million.
According to Amberdata, a sustained BTC price recovery would require a liquidity value of $35 million or more than $40 million to underline market makers’ renewed confidence and pre-October crash conditions.
Otherwise, the company warned:
Expect decreasing depth while price remains stable – this divergence preceded the October collapse. A depth below $25 million (10 basis points) combined with increasing volume would indicate increased cascade risk.
The company added that liquidity has gradually improved, but “full recovery is unlikely in the near term.”
Put another way, market makers amplify price movements and any selling pressure if liquidity falls below $25 million would likely accelerate a liquidation wave and downside risk.
What’s next for BTC?
Separately, there was a surge in Bitcoin inflows to exchanges. CryptoQuant’s head of research, Julio Moreno, warnings that $75K or $85K could become a major resistance.
Furthermore, as April tax season approaches, the typical broader net liquidity decline in the dollar could derail the recovery.
In the short term, however, Bitfinex analysts told AMBCrypto that a sustained rally would only be possible if BTC converts $75,000 into support.
If BTC remains above the $75,000 to $78,000 acceptance zone while other risky assets lag, it signals strong spot-driven supply and demand absorption, which is typically the harbinger of an ongoing breakout.
Overall, the recent recovery has attracted more debt-laden bulls. But the low liquidity in the order book still shows that the market is not out of the woods yet.
Final summary
- Order book liquidity was still below pre-October crash levels, with Amberdata urging BTC traders to remain cautious.
- CryptoQuant also predicted a possible cooling of the BTC rally near $75,000 or $85,000.