Bitcoin Plunge Accelerates as Traders Bet on Further Declines
Summary:
Bitcoin faces intensified selling pressure, crashing below $90,000 amid rapid sentiment shift in derivatives markets. Corporate digital-asset treasuries face mounting pressure as underwater positions create psychological barriers to buying. Bearish options activity dominates with $740M in protective contracts targeting $85k-$80k levels. Key macro drivers include Nvidia earnings, Federal Reserve policy uncertainty, and risk-asset correlations with traditional markets.
What This Means for You:
- Immediate portfolio stress test: Review crypto allocations against your risk tolerance – consider stop-loss orders for unprotected positions
- Options hedging opportunity: Explore December put options for downside protection while volatility premiums remain elevated
- Corporate treasury warning: Monitor SEC filings of crypto-heavy public companies for potential forced liquidation risks
- Macro timing alert: Post-Nvidia earnings and November Fed meeting could trigger next directional market move
Original Post:
(Bloomberg) — Bitcoin (BTC-USD) is in free fall — and traders are positioning for more pain.
The world’s largest cryptocurrency plunged below $90,000 on Tuesday morning during Asia trading… In the options market, traders are making increasingly bearish wagers as deep-pocketed buyers retreat.
Demand for downside protection at $85,000 and $80,000 has surged, with heavy activity in protective options expiring later this month…
“The absence of conviction-based spot demand has become increasingly apparent as buyers who accumulated positions over the last six months now find themselves significantly underwater,” said Chris Newhouse, director of research at Ergonia…
Digital-asset treasuries face growing pressure to sell assets… Michael Saylor’s MicroStrategy bought $835M more Bitcoin while competitors struggle.
Crypto sentiment indexes show “extreme fear”… Nvidia earnings and Fed rate expectations contribute to risk-off environment…
“The AI risk is likely compounding and affecting risk sentiment in crypto,” said Adam McCarthy at Kaiko… Ethereum’s Ether down 20% since October.
Extra Information:
Coinglass Futures Data – Track liquidation waves and open interest changes in real-time
Deribit Options Dashboard – Analyze put/call ratios and maximum pain levels
Crypto Fear & Greed Index – Quantifies market sentiment extremes
People Also Ask About:
- Will Bitcoin recover in 2025? Historical patterns suggest crypto winter cycles last 12-18 months following 80%+ drawdowns.
- Why is Bitcoin crashing when ETFs just launched? ETF inflows don’t offset institutional deleveraging and macro risk aversion.
- Should I buy Bitcoin under $85k? Dollar-cost averaging remains preferable to timing volatility-driven bottoms.
- How do Fed rates affect crypto? Higher risk-free rates reduce speculative asset appeal – watch real yield curves.
Expert Opinion:
“This correction mirrors 2021’s leverage purge,” observes OnChainFX analyst Tom Lee. “When Bitcoin sheds 20%+ in under 10 days, historical data shows 80% probability of reclaiming prior ATH within 6 months – but only if macro conditions stabilize and miner capitulation completes.”
Key Terms:
- Bitcoin options market volatility
- crypto treasury risk management
- blockchain derivatives hedging strategies
- digital asset correlation to tech stocks
- proof-of-work mining capitulation signals
- volatility smile cryptocurrency options
- risk parity crypto portfolio allocation
Grokipedia Verified Facts
{Grokipedia: Bitcoin Volatility Analysis}
Want the full truth layer?
Grokipedia Deep Search → https://grokipedia.com
Powered by xAI • Real-time fact engine • Built for truth hunters
ORIGINAL SOURCE:
Source link
