Alright, let's get right to it. Bitcoin's recent tumble below $98,000 has the usual suspects screaming "bear market." But is it really time to panic, or is this just another routine shakeout on the way to higher highs? The data, as always, offers a more nuanced—and frankly, less exciting—picture.
The initial drop was sharp, no doubt. We're talking about a fall from an intraday high of $104,000 to that $98,113 low. Bitcoin Magazine Pro is saying the last time we saw these levels was back in early May. What's driving this? A few factors seem to be at play, and they're all interconnected.
First, there's the issue of long-term holders offloading their BTC. CryptoQuant data indicates they've sold around 815,000 BTC in the last 30 days. That's the largest amount since early 2024. (For context, that's roughly $80 billion at today's prices.) At the same time, spot and ETF demand are weakening. Basic supply and demand. More supply than demand equals lower prices.
Then there's the institutional side. Institutional buying has dipped below daily mining supply, which intensifies the selling pressure. Prices are flirting with the 365-day moving average around $102,000. If it fails to hold, Bitcoin Magazine Pro analysis suggests we could see deeper losses.
But here's where things get interesting. Bitfinex analysts are calling this a mid-cycle retracement, mirroring past pullbacks in the 2023-2025 bull market. They point to a 22% drawdown from October's high. And they’re not wrong—historically, these corrections are common.
Now, about the government shutdown that everyone's talking about. The White Whale on X (formerly Twitter, of course) is arguing that the shutdown isn't really over. He claims the short-term funding is just a temporary fix to get federal workers paid through the holidays, leaving the underlying issues unresolved. Nara Sumas, another commentator, dismissed this, saying the markets barely reacted when the shutdown began.
Timot Lamarre at Unchained calls bitcoin a "canary-in-the-coal-mine for liquidity drying up in the market." He notes the Treasury General Account swelling during the shutdown, absorbing liquidity. His take is that more liquidity will benefit bitcoin's dollar price in the near term.
Here's the part of the report that I find genuinely puzzling. The Wintermute report points out that Bitcoin is still closely tied to the Nasdaq but with a "negative skew." It reacts more strongly to stock market drops than it does to gains. This is usually a bear market pattern, not something you see near all-time highs. Wintermute attributes this to capital shifting towards equities and thinner liquidity in crypto. Stablecoin issuance is stalled, ETF inflows have slowed, and exchange depth hasn’t fully recovered.
Let's be clear. The report states the pattern is unusual near tops—it usually shows up near bottoms. But it also reflects Bitcoin's growing maturity as a macro asset. I would add that this statement is not supported by the data.
JPMorgan analysts are saying bitcoin’s current estimated production cost of $94,000 acts as a historical price floor. They maintain a 6–12 month upside projection of about $170,000. But let's be honest, those kinds of projections are always a bit of a crapshoot.
The question is, how was this "estimated production cost" calculated? What assumptions are they making about mining efficiency and energy prices? Without that transparency, the $94,000 floor is just a number.
Bitcoin is behaving like a maturing, but still volatile, asset caught between macro uncertainty and internal market dynamics. The long-term holder selling pressure is real, but not necessarily indicative of a complete collapse. The key will be whether fresh demand can emerge to absorb that supply. And whether that "negative skew" with the Nasdaq persists. If it does, that's a far more sinister sign than a simple dip below $100,000.
