Bitcoin fell as much as 6% on Monday to below $86,000 during early Asian trading amid high selling pressure.
Most tokens followed a similar pattern, with Solana, Ethereum, and XRP experiencing about 8% drop.
After a weeks-long selloff that began when about $19 billion in leveraged bets were wiped out in early October, just days after Bitcoin hit an all-time high of $126,251, the cryptocurrency market remains fragile.
The pioneer crypto lost 16.7% of its value in November, but it recovered last week and surpassed $90,000 amid reduced selling pressure. 216,942 traders were liquidated in the past 24 hours; the total liquidations came in at $638.83 million
The main concerns are the lack of dip buyers and minimal inflows into Bitcoin exchange-traded funds. We expect these structural challenges to persist this month. The next key support level for Bitcoin is $80,000. S
trategy CEO Phong Le said on a podcast Friday that Bitcoin could be sold if its mNAV, a ratio of enterprise value to Bitcoin holdings, became negative. Investors were digesting these remarks on Monday.
He added, “We can sell Bitcoin, and we would sell Bitcoin if we needed to fund our dividend payments below 1x mNAV.” According to its website, Strategy, which holds $56 billion in Bitcoin, has seen its mNAV drop to 1.19.
The world’s largest stablecoin, USDT, was downgraded to its lowest rating by S&P Global Ratings last week, warning that a decline in Bitcoin’s value could leave the token undercollateralized until further notice.
Spot Bitcoin ETF flows remain disappointing
One of the main reasons Bitcoin’s prices remain stagnant is the lack of new capital flowing into exchange-traded funds (ETFs). For the week ending November 28, Bitcoin ETFs only grew by $70 million in net assets.
This is a small figure compared to the huge amounts received during the early stages of institutional adoption. Inflows into Bitcoin ETFs reached $220 million during Thanksgiving week, and $312 million into Ether ETFs, but this is just a minor uptick. Actions by corporate Bitcoin holders are more concerning.
- None of the major companies holding Bitcoin as treasury reserves has increased their purchases in the past two weeks. One of the largest commercial buyers, Strategy, boosted its purchases on November 17.
- Meanwhile, 1,163 BTC was linked to SpaceX’s transfer to new addresses on Thursday, sparking speculation about a possible sale. However, there has been no official statement on whether this is a distribution or a transfer of custody.
The Bitcoin derivatives market is showing signs of caution.
- Like last week, monthly futures contracts are only 4% higher than in spot markets, which is significantly less than the 5–10% range typically seen when conditions are neutral. Perhaps because of Bitcoin’s 18% decline over the past 30 days, this low basis rate indicates a lack of interest in leveraged long bets. A similar narrative can be found in the options market.
- There were significantly more put (sell) options than call (buy) options on both Thursday and Friday. This demonstrates how uncertain traders were. Since it reached an exceptional 5x level on November 21, which favored downside protection, the put-to-call premium volume ratio has improved.
It is still higher than the 1.3x level, though, which would indicate more neutral market conditions. The negative technical picture is further compounded by the recent decline of Bitcoin below the lower band of a developing bear flag pattern.
The People’s Bank of China added to the uncertainty on Saturday when it warned about the dangers of virtual currencies, including stablecoins, and said that government agencies should work more closely together to combat illicit activity
The upcoming week is expected to provide an important glimpse of US economic momentum, as Expectations regarding whether the Federal Reserve will continue to lower interest rates are likely to be shaped by the data. After making it clear that he anticipates interest rate cuts from his nominee, US President Donald Trump announced on Sunday that he had chosen the next Fed chair.
