The Bitcoin market is undergoing a major transition, with traders aggressively positioning for a year-end close below the $90,000 threshold.
This comes after the flagship digital asset temporarily fell to a seven-month low of $89,970 on November 18, before recovering to $91,526 at the time of writing.
As a result, the sentiment of crypto traders has changed significantly as structural capital flight and tight macro conditions have subsided.
Option Desk Bitcoin Price Under $90,000
The most conclusive evidence of this bearish belief comes from options flow and prediction markets.
Crypto options platform Derive.xyz said crypto slate Traders are currently pricing in a 50% chance that Bitcoin will end the year below $90,000. This is roughly in line with Polymarket crypto bettors who believe 36% of top cryptocurrencies will end the year at or below $80,000.
In fact, the bearish positioning appears as active risk mitigation, suggesting that the professional desk is actively betting against the previously held bullish consensus.
Derive.xyz pointed out that Bitcoin’s implied volatility (IV) is increasing in parallel in both the short and long term. For context, BTC’s short-term IV rose significantly from 41% to 49% in two weeks, while long-term volatility (180 days) stayed roughly in lockstep, rising from 46% to 49%.
This suggests that traders view the current decline as the early stages of a longer-term, deeper structural shift in macro conditions and market sentiment, rather than a temporary spike.
Derive.xyz added:
“With continued concerns about the resilience of the US job market and the probability of a December rate cut dropping to a coin flip, there is little macro backdrop for traders to remain bullish through the end of the year.”
Further supporting this pessimism is the widening of the 30-day put skew, which measures the premium paid for downside protection (puts) compared to the premium for upside exposure (calls).
The skew has plummeted from -2.9% to a very defensive -5.3%, indicating that traders are not just hedging, but are paying a lot of money to protect against a large sustained decline.
The company says this is a sign that the market is moving into a new, more frightening volatility regime, with risk aversion dominating positioning into the end of the year.
ETF outflow
This defensive option positioning was directly facilitated by the dramatic reversal of flows within the Spot Bitcoin ETF complex.
For much of 2025, these ETFs provided essential marginal bids and acted as primary stabilizers by continuously absorbing supply. However, that functionality has now stopped.
The scale of the institutional setback is staggering, with total Bitcoin ETF outflows of nearly $3 billion ($2.5 billion net) this month alone, according to SoSoValue data. Notably, this is expected to be the second-highest outflow month since these products were launched in 2024.
BlackRock’s IBIT, the largest institutional investor, is typically the most powerful structural buyer in the market and accounts for the majority of these withdrawals.
This sustained sell-off removes the market’s most reliable absorption mechanism, with the serious consequences of evaporating structural demand and dramatically reducing liquidity.
This illiquid environment increases volatility and what would normally be a shallow decline quickly deepens into a price decline.
Additionally, parallel actions across the ecosystem have further widened the absence of consistent institutional investors. Major BTC treasury companies have paused their previous accumulation patterns and in some cases reduced their holdings.
Even MicroStrategy (Strategy), a stronghold of corporate bulls, is showing signs of stress. Their recent purchase of 8,178 BTC was a small amount compared to their previous purchases and was executed at a price of around 10% above current levels.
As a result, 40% of the financial assets of 649,870 BTC are currently in loss, fundamentally weakening the stability of the company’s financial floor.
Therefore, while ETF outflows alone do not determine price, the presence of ETF outflows in an environment of contracting liquidity amplifies all other negative signals.
Long-term holder sells
The current economic downturn is also being shaped by selling from an unexpected corner of the market: long-term holders (LTH).
These holders have historically been the most resilient group, moving or selling a total of over 800,000 BTC in the past 30 days. Typically, an LTH capitulation indicates a late-stage drawdown just before the bottom, but this time the move seems a little different.
Ki Young Ju of CryptoQuant suggested that this move is not a wholesale collapse of trust, but rather an internal rotation.
He said older whales are strategically moving generational holdings into new, structurally sound institutional investors such as sovereign funds, pensions and multi-asset managers.
He noted that these new institutions typically have much lower surrender rates and much longer investment horizons.
Therefore, if this is true, this rotation could be viewed as long-term bullish, essentially shifting supply from early adopters to stable, permanent investors.
However, short-term price fluctuations due to these offloads are still harmful.
On-chain metrics highlight this severe selling pressure, with Glassnode data showing that short-term holders (STH) are realizing losses of approximately $427 million per day, a level not seen since the capitulation in November 2022.
As a result, the loss-making supply of STH BTC surged to levels that historically coincide with market bottoms.
However, Swissbloc analysts insist there is still no panic-driven “capitulation sell”, but add that the current regime clearly shows that the “window to the bottom” is open.
With this in mind, this is the period of greatest uncertainty meaning that while a lower bound may be forming, the market has not confirmed it yet and continued selling pressure could easily push prices lower before stabilizing.
Macro headwinds tighten the rope.
Ultimately, the most decisive factor driving current actions is the increasingly hostile global macro context.
Bitcoin trades less as a singular asset and more as a high-beta expression of global risk sentiment. Riskier assets are bound to suffer when global liquidity contracts.
Hopes for a December Federal Reserve rate cut, a major bullish trigger that was confidently priced in earlier this year, have collapsed to essentially even odds.
Traders currently believe there is a 46.6% chance that the Fed will cut rates at its Dec. 10 FOMC meeting and a 53.4% chance that the Fed will leave rates unchanged, according to CME FedWatch data.
This new hawkish stance directly translates into tight liquidity, amplifying risk aversion as rising U.S. Treasury yields and weak stock markets put pressure on all asset classes. Cryptocurrencies are caught squarely in this undertow.
Shrinking global liquidity is forcing traders to aggressively hedge risk toward the end of the year, rather than betting on speculative upside.
This macro pressure supports the bearish signals seen in the options market. On-chain momentum indicators place Bitcoin squarely in the pessimistic “correction” zone around 0.72.
If this indicator continues to decline, the technical model will point to a significant correction target at $87,500, a key support level dating back to early 2025.
Therefore, for prices to stabilize, a significant reversal in liquidity and sentiment would be required for the market to stabilize between $90,000 and $110,000.
Wintermute says:
“Until Bitcoin returns to the upper end of its range, the market will remain narrow and the story will remain short-lived.”
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