The Bitcoin market is currently navigating a period of profound uncertainty, marked by a significant shift in trader sentiment. What was once a landscape dominated by bullish anticipation has transformed, with a growing number of market participants now actively positioning for the flagship digital asset to conclude 2025 below the $90,000 mark. This bearish conviction has gained traction following Bitcoin's recent dip to a seven-month low of $89,970 on November 18, before a slight recovery to $91,526. This move is not an isolated event but rather a symptom of converging forces: a notable exodus of institutional capital and an increasingly tight global macroeconomic environment.
Options Market Reveals Deepening Bearish Bets
Perhaps the most compelling evidence of this evolving sentiment comes directly from the crypto options markets and prediction platforms. Data from crypto options platform Derive.xyz indicates that traders are currently pricing a substantial 50% probability that Bitcoin will end the year below $90,000. This outlook is largely echoed by crypto bettors on Polymarket, where a significant 36% believe the top cryptocurrency could even finish 2025 below the $80,000 threshold. These figures paint a clear picture: professional desks are actively mitigating risk and, in many cases, placing direct bets against the previously held bullish consensus.
Derive.xyz further highlights how this bearish positioning is manifesting. Both short-term and long-term implied volatility (IV) for Bitcoin have been on a consistent upward trajectory. To put this in perspective, BTC's short-term IV has jumped from 41% to 49% in just two weeks, while its 180-day long-term volatility has mirrored this trend, climbing from 46% to 49%. This parallel rise in volatility suggests that traders aren't viewing the current price dip as a mere transient blip. Instead, it appears to be perceived as the nascent stage of a more protracted and fundamental structural shift, influenced by broader macro conditions and a palpable change in market psychology.
“With ongoing concerns about the resilience of the US job market and the probability of a December rate cut slipping to barely above a coin-toss, there’s very little in the macro backdrop giving traders a reason to stay bullish into the close of the year.” – Derive.xyz
Adding another layer to this pessimism is the widening 30-day put skew. This metric, which gauges the premium paid for downside protection (puts) versus upside exposure (calls), has plummeted from –2.9% to a highly defensive –5.3%. Such a dramatic shift signals that traders are not just hedging their existing positions, but are actively incurring significant costs to safeguard against a substantial, sustained downturn. According to Derive.xyz, this trend is indicative of a market transitioning into a new, more fearful volatility regime where risk aversion unequivocally dictates year-end positioning.
Dramatic ETF Outflows Signal Institutional Retreat
This defensive options stance has been directly catalyzed by a stark reversal in the flow of capital within the Spot Bitcoin ETF complex. For a considerable portion of 2025, these ETFs served as a vital marginal bid, providing crucial stability by consistently absorbing market supply. However, that function has now largely evaporated.
The scale of the institutional pullback is striking. Bitcoin ETFs have collectively recorded gross outflows nearing $3 billion this month alone, with net outflows reaching approximately $2.5 billion, according to SoSoValue data. This places the current month on track to become the second-largest period for outflows since these products first launched in 2024. Significantly, BlackRock's IBIT, typically the market's most robust structural buyer, has accounted for the majority of these withdrawals. This sustained selling pressure removes what was once the most reliable absorption mechanism in the market, leading to a critical consequence: structural demand is dissolving, and market liquidity is thinning dramatically.
In such a liquidity-constrained environment, volatility naturally increases. What might typically manifest as a shallow price dip can quickly deepen into a more severe drawdown. Furthermore, parallel actions across the wider crypto ecosystem have amplified the impact of this vanishing institutional buyer. Major BTC treasury companies have paused their historical accumulation patterns, with some even reducing their holdings. Even MicroStrategy, long considered a corporate bastion of bullishness for Bitcoin, is showing signs of stress. Their recent purchase of 8,178 BTC was modest compared to previous acquisitions and was executed at a price roughly 10% above current levels. Consequently, a significant 40% of their impressive 649,870 BTC treasury is now underwater, fundamentally weakening the perceived stability of this corporate treasury floor.
While ETF outflows alone do not entirely dictate price, their presence in a contracting liquidity environment profoundly magnifies every other negative signal reverberating through the market.
Long-Term Holders Join the Selling Pressure
The current market downturn is also being shaped by an unexpected source of selling: Long-Term Holders (LTHs). Historically, this cohort has represented the most resilient segment of the Bitcoin market. However, in the past 30 days, LTHs have collectively moved or sold over 800,000 BTC. While LTH capitulation often marks the late stages of drawdowns, preceding a market bottom, the dynamics this time appear subtly different.
Ki Young Ju of CryptoQuant suggests that this movement may be less about a wholesale collapse of confidence and more about an internal rotation of capital. He posits that established whales are strategically offloading their generational holdings to a new, structurally robust class of institutional buyers. This includes entities such as sovereign funds, pension funds, and multi-asset managers, which generally exhibit significantly lower churn rates and possess much longer investment horizons. If this hypothesis holds true, this rotation could be interpreted as a long-term bullish signal, effectively transferring supply from early adopters to stable, perpetual investors. Nevertheless, the near-term price impact of these significant offloadings remains undeniably detrimental.
On-chain metrics further underscore this acute selling pressure. Glassnode data reveals that Short-Term Holders (STHs) are realizing losses of approximately $427 million per day. This level of loss realization for STHs has not been observed since the significant capitulation event of November 2022.
As a direct consequence, the supply of STH Bitcoin held at a loss has surged to levels historically consistent with market bottoms. However, analysts at Swissblock have argued that despite these concerning figures, panic-driven “capitulation selling” is not yet evident. They suggest that the current setup clearly signals an “open bottoming window.” This implies a period of maximum uncertainty, meaning that while a potential floor might be forming, the market has yet to confirm it, and continued selling pressure could easily push the price lower before any stabilization materializes.
Tightening Macro Headwinds Exert Pressure
Ultimately, the most decisive factor influencing current market behavior is the increasingly hostile global macroeconomic backdrop. Bitcoin is now trading less like a unique, idiosyncratic asset and more like a high-beta expression of broader global risk sentiment. When global liquidity contracts, high-risk assets invariably bear the brunt of the downturn.
Expectations for a December Federal Reserve rate cut, which had been confidently priced in as a key bullish catalyst earlier in the year, have essentially collapsed to even odds. According to CME FedWatch data, traders now assign a 46.6% chance of a rate cut at the December 10 FOMC meeting, compared to a 53.4% probability that the Fed will opt to keep rates unchanged. This renewed hawkishness directly translates into tighter liquidity, amplifying risk aversion as rising Treasury yields and fragile equity markets pressure all asset classes. Crypto is squarely caught in this financial undertow.
With global liquidity contracting, traders are compelled to aggressively hedge risk into year-end, rather than taking on speculative upside bets. This pervasive macro pressure validates the bearish signals that are so evident in the options market. On-chain momentum indicators further place Bitcoin squarely within the Pessimism 'Correction' zone, currently hovering around 0.72.
Should this metric continue its decline, technical models point toward a critical correction target of $87,500, a key support level dating back to early 2025. Therefore, any meaningful price stabilization would necessitate a robust reversal in both liquidity and sentiment, allowing the market to consolidate within the range of $90,000 to $110,000. As Wintermute aptly stated:
“Until BTC moves back toward the top of its range, market breadth is likely to stay narrow and narratives will remain short-lived.”
The current confluence of aggressive bearish positioning in options, substantial institutional outflows from ETFs, and tightening macro conditions paints a challenging picture for Bitcoin’s near-term trajectory. While the long-term prospects may benefit from a shift towards more stable institutional ownership, the immediate outlook suggests continued volatility and a genuine possibility that Bitcoin could indeed end 2025 below the pivotal $90,000 threshold.
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