Bitcoin Falls Below $86K Amid Market Uncertainty: December Opens on Weak Footing

Bitcoin opened December on a shaky note, sliding as much as 6% to breach the $86,000 support level during early Asian trading on Monday. The flagship cryptocurrency faced heightened selling pressure, signaling continued fragility after a turbulent November in which Bitcoin lost over 16% of its value. Other major tokens, including Ethereum, Solana, and XRP, mirrored the downward trend with losses approaching 8%.

The decline follows weeks of market instability that began in early October, when leveraged bets worth roughly $19 billion were wiped out, just days after Bitcoin reached its all-time high of $126,251. Although the cryptocurrency briefly recovered last week to surpass $90,000, high liquidation rates continue to rattle traders. In the past 24 hours alone, 216,942 positions were liquidated, totaling $638.83 million in losses.

Analysts cite structural challenges in the market, including a shortage of dip buyers and muted inflows into Bitcoin exchange-traded funds (ETFs), as key reasons behind the persistent weakness. Strategy CEO Phong Le recently suggested that the company might sell Bitcoin if its enterprise value ratio (mNAV) dropped below one, a warning that investors are still processing. Meanwhile, the largest stablecoin, USDT, was downgraded by S&P Global Ratings last week, raising concerns about potential undercollateralization if Bitcoin continues to fall.

Institutional participation in ETFs has also cooled. For the week ending November 28, net assets for Bitcoin ETFs grew by just $70 million—a sharp contrast to earlier inflows exceeding $200 million. Major corporate holders have largely paused additional purchases, with only isolated transactions such as Strategy’s November 17 acquisition and SpaceX’s 1,163 BTC transfer drawing attention. Derivatives markets echo the caution, with futures and options indicating limited appetite for leveraged long positions.

Adding to the uncertainty, the People’s Bank of China issued warnings over cryptocurrencies and stablecoins, urging closer government oversight of illicit activity. Globally, traders are watching upcoming U.S. economic data and Federal Reserve policy signals, which could shape investor sentiment in the coming week. With technical indicators trending negative and key support levels under pressure, Bitcoin’s path this December remains uncertain.

source: nairametrics