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 token moved around $90,700, leaving it roughly 25% below its 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. Related reading: From Dotcom to Crypto: Veteran Analyst Says the Bull Run Isn’t Over Yet Analysts See a Near-Term Bottom According to an interview on CNBC, BitMine Chairman Tom Lee said the October 10 liquidations and continued uncertainty over whether the US Federal Reserve will cut rates in December have kept the pressure on crypto. He described signs of exhaustion among sellers and cited technical research indicating a bottom could emerge soon. Tom Lee and Matt Hougan both say crypto prices are approaching a bottom. Source: YouTube Bitwise Asset Management Chief Investment Officer Matt Hougan 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. Selling driven mainly by short-term holders According to XWIN Research, a review of on-chain measures found that short-term holders 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 adds pressure Reports indicate that outflows of exchange-traded funds and heavy selling by 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. Related Reading: Crypto Carnage Continues – Tom Lee Reveals What’s Really Going On Outlook Depends on Stocks and Policy 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
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