Bitcoin dips under $90K as market prepares for a bigger correction
Bitcoin and crypto prices have faced challenges since reaching their highs in early October, as traders express concerns that the market may be on the brink of a $1 trillion downturn. The bitcoin price has fallen to approximately $90,000 per bitcoin, a decline from its peak of $126,000 in October, as U.S. president Donald Trump prepares the market for a “immediate” game-changer. In a significant development, the chair of the U.S. Securities and Exchange Commission has made a “huge” crypto prediction. Meanwhile, Michael Saylor has raised alarms about potential “chaos, confusion,” and “profoundly harmful consequences” should his bitcoin-buying company Strategy be removed from MSCI indices. “The bitcoin hoarding will continue until the complaining stops,” Michael Saylor tweeted. Last year, Strategy’s inclusion on the Nasdaq 100, which serves as the foundation for the widely-used Invesco QQQ exchange-traded fund, was anticipated to lead to approximately $2.1 billion in net buying of the company’s shares as portfolios recalibrate to this development, as per analysts.
The company capitalized on the bitcoin price surge leading into 2025, yet has faced challenges as the bullish trend has waned in recent months. The Nasdaq decision brings a sigh of relief for Strategy shareholders, especially after the company’s stock price has nosedived by 60% from its all-time highs in the past six months. Nasdaq’s decision, which had the potential to significantly impact the company’s valuation if it had swung in the opposite direction, was met with enthusiasm from bitcoin supporters. “Those who don’t own bitcoin will become increasingly irrelevant,” stated Adam Livingston. “They can fight all they want. Victory is inevitable.” Livingston remarked that the atmosphere surrounding the discussion on Strategy’s inclusion in the Nasdaq 100 and MSCI indices indicates, “people want Strategy to fail. Have you ever actually seen a group of people consistently advocate for the collapse or liquidation of a company the way they do against Strategy?” he inquired.
In the wake of the Federal Reserve’s recent interest rate cut, a notable downturn in bitcoin prices has emerged, sparking concerns that a significant price crash may be on the horizon. “Fear and greed indices have shifted into a state of extreme fear.” Markus Levin stated “All of this supports deeper corrective action.” Saylor has reached out to MSCI, urging the organization to reconsider a proposal that would exclude companies with crypto holdings surpassing 50% of their total assets from its global equity benchmarks. Saylor and Strategy’s chief executive Phong Le articulated in their 12-page letter the “profoundly harmful consequences” that could arise if MSCI moves forward with the proposal, with a decision anticipated by January 15. “MSCI faces a pivotal choice: it can either fall prey to the reactive short-sightedness often exhibited by established institutions regarding innovation, or it can permit its indices to authentically and impartially represent the forthcoming era of financial technology,” the pair stated. “The wiser course—for MSCI, for investors, and for the broader economy—is for MSCI to remain neutral and let the markets decide the course of [digital asset treasury companies].” Should MSCI proceed with the proposal, it may trigger outflows reaching up to $8.8 billion from Strategy’s stock, contingent on whether other index providers align with this move, as per a JPMorgan estimate.
Saylor’s comments found resonance in Adam Back, a bitcoin development firm and a figure referenced in the enigmatic Satoshi Nakamoto’s bitcoin white paper. In an interview, Back stated that we are still in the “very early stages” of bitcoin adoption and predicted that all companies will ultimately transition into bitcoin treasury companies. In a significant shift, Standard Chartered has revised its end of 2025 bitcoin price forecast, cutting it from $200,000 to $100,000. “We think buying by bitcoin digital asset treasury companies is likely over,” stated Geoff Kendrick, global head of digital assets research at Standard Chartered, in an emailed note, emphasizing that bitcoin treasury company “buying is unlikely to provide further support.” Bitcoin and crypto treasury companies have amassed approximately 1 million bitcoin, valued at nearly $100 billion this year, competing closely with bitcoin exchange-traded funds that currently hold 1.5 million bitcoin worth $1.4 billion. Despite a slowdown in purchases from bitcoin treasury companies, analysts anticipate that ETF acquisitions will keep driving bitcoin purchases through 2026. “We now think future bitcoin price increases will effectively be driven by one leg only–ETF buying,” Kendrick stated. Analysts have highlighted the increasing bitcoin ETF inflows as a possible trigger for an impending surge in bitcoin prices. “For prices to break higher, the bullish momentum from the rate cut needs to overpower the concentrated short pressure sitting near the $94,500 resistance level,” David Hernandez stated. “If spot ETF inflows strengthen as expected now that the cost of capital is falling, that could become the spark that transforms caution into momentum and drives bitcoin back above the $100,000 psychological barrier.”
