Bit of a problem: Bitcoin crashes below $90K as bear market bites

Bitcoin started December 2025 sliding further into its bear market, with prices falling as low as $85,461, marking a 32% drop from its October peak near $126,200, according to Business Insider. This decline is unusual because Bitcoin has historically rallied during the year's final months, with an average December gain close to 30%, according to Alex Kuptsikevich, chief market analyst at FxPro.

Market sentiment and global factors drive down Bitcoin

A growing risk-off mood among investors is a key driver. Bitcoin’s recent price moves have mirrored high-flying tech stocks, both under pressure as investors sell assets to meet margin requirements amid ongoing market uncertainty. CNN's Fear and Greed Index remains in "Extreme Fear," signaling continued bearish sentiment, Business Insider reports. Additionally, an official from the Bank of Japan hinted at possible interest rate hikes, the report says, raising concerns about unwinding the yen carry trade, which typically supports risk appetite globally. This has spurred volatility and cautious positioning, especially among Asian investors, noted Farzam Ehsani, CEO of crypto exchange VALR.

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Liquidity issues compound the problem. Following a major liquidation event in October, liquidity has dried, making Bitcoin’s price more vulnerable to shocks, Business Insider confirmed. Data from crypto analytics firm Kaiko showed Bitcoin's market depth dropped from $766.4 million in early October to around $568.7 million recently. This shallow order book makes the market less resilient to large trades or macroeconomic disruptions, Ehsani explained.

Institutional pressure and potential selling add to downward spiral

Corporate Bitcoin holders like Strategy, the largest public buyer of Bitcoin, have also intensified concerns. Strategy’s mNAV—a measure comparing the company’s value to its Bitcoin holdings—hovered near a critical level of 1.2 last week, Business Insider reports. According to the report, CEO Phong Le warned that if the value dips below 1, they might be forced to sell some Bitcoin, though he described that as a "last resort." Recent estimates from crypto intelligence firm Akrham Intel indicate Strategy’s holdings have already shrunk from around 484,000 to 437,000 BTC this month, fueling speculation about sales. Ehsani cautioned that if the bear market persists, Bitcoin could fall by another 30%, possibly dipping close to $60,000.

Adding to the bearish atmosphere, crypto liquidations reached nearly $1 billion in 24 hours, with Bitcoin down about 6% on Monday to $85,788 — its biggest single-day drop since early November, as reported by CoinGlass, according to Reuters. This aligns with broad tech sector weaknesses and investor wariness about future Federal Reserve moves.

With weak liquidity, global macroeconomic uncertainty, and institutional jitters driving sell-offs, Bitcoin’s path remains uncertain as December unfolds.