Bitcoin Bear Market Risk

Bitcoin (BTC) briefly dipped under $94K before rebounding to $97,200, reflecting high volatility in the market.

In this environment, a potential Bitcoin bear market could arise if key investor groups, currently holding unrealized profits, begin to sell.

Key Levels to Watch

If BTC loses momentum and falls below $89,300, it could lead to profit-taking among short-term holders (those holding 1,000+ BTC for less than 155 days), thus increasing sell pressure.

The critical level to monitor is $58,000, which represents the realized price of miner whales (wallets of mining companies holding over 1,000 BTC). Historically, breaching this level has indicated the start of Bitcoin bear market cycles, making it a vital long-term support.

While BTC currently has a safe margin, persistent volatility could test these key levels. Maintaining levels above them is essential for a bullish market structure.

Will Bulls Prevent a Bitcoin Bear Market?

Despite a hawkish macroeconomic backdrop in the U.S., bulls have managed to defend the $90K level for over a month, indicating strong demand.

However, prolonged consolidation near resistance suggests a potential liquidity trap. If BTC breaks above $99K without robust spot demand, leveraged long positions may close, leading to liquidation cascades.

A drop back to $90K would be a crucial test. Falling below this mark could push BTC toward $89,300, increasing the likelihood of short-term holder whales offloading, which would intensify downside pressure.

Although a Bitcoin bear market isn’t yet confirmed, weak ETF inflows, diminishing FOMO, and decreasing network activity could trigger a sharp reversal, potentially wiping out billions in leverage.