Bitcoin traded near the $110,000 support level on Thursday after experiencing notable volatility driven by large whale activity and a surge in put option demand. Following a roughly 12% decline from last week’s record highs, the cryptocurrency appears to be balancing between short-term risk and long-term structural demand. Analysts suggest that while immediate market conditions are turbulent, underlying forces could stabilize Bitcoin heading into year-end.
The cryptocurrency briefly slipped to $109,800 before rebounding to around $111,200. The decline comes in the wake of one of the largest deleveraging events in crypto history, which saw more than $19 billion in positions liquidated over the previous weekend. According to Matt Hougan, Chief Investment Officer at Bitwise, the episode represented a “structural reset” rather than a market collapse, highlighting the resilience of the asset despite widespread selling.
Whale Activity and Put Demand Signal Caution
Industry experts point to significant activity from Bitcoin whales as a key factor behind the recent pullback. Timothy Misir, head of research at BRN, noted that large holders with positions ranging from 10 to 10,000 BTC sold roughly 17,500 coins during the recent correction. Despite this, these whales remain net buyers year-to-date, having accumulated more than 318,000 BTC overall.
The surge in put option demand—contracts that gain value when prices fall—further underscores investor caution. Misir highlighted that bulk puts totaled over $1.15 billion, making up about 28% of recent trade flow, while call options were concentrated in the $115,000–$130,000 range. “This is selective distribution, not panic,” he said, emphasizing that institutional investors are hedging rather than exiting the market entirely.
Options data from The Block indicate a put-call open interest ratio above 0.5, with short-term implied volatility climbing above 60%, levels similar to those observed during the early October drawdown. These metrics suggest heightened risk awareness among traders while signaling that the market is still functioning as a two-way, headline-driven environment.
Broader Market Impact
The ripple effects of Bitcoin’s volatility were seen across the wider crypto market. Ethereum fell below $4,000, while Solana and XRP each declined by over 3%. The total cryptocurrency market capitalization dropped to around $3.8 trillion, reflecting a broad-based retreat in digital assets.
CoinGlass data also revealed that over $500 million in leveraged positions were liquidated within the past 24 hours, marking another wave of forced selling. Analysts attribute part of this selling pressure to macroeconomic concerns, including renewed tensions between the United States and China over tariffs, as well as the ongoing U.S. government shutdown, both of which have weighed on risk appetite for cryptocurrencies.
The Fear & Greed Index, a widely followed measure of investor sentiment, has fallen to 28, reflecting rising caution among market participants. Low sentiment readings often indicate a market ripe for stabilization or eventual recovery, though the timing and magnitude of any rebound remain uncertain.
ETF Inflows and Dovish Fed Signals Provide Support
Despite the short-term turbulence, structural demand continues to offer a potential floor for Bitcoin prices. Matt Mena, crypto research strategist at 21Shares, highlighted that over $6 billion in U.S. ETF inflows occurred in the past month, reflecting steady institutional interest. Combined with expectations for more dovish U.S. Federal Reserve policies, these factors could support market stability and pave the way for a year-end recovery.
Mena noted that the recent deleveraging has effectively flushed excess risk from the market, leaving a leaner structure better suited to absorb volatility. He suggested that with continued ETF inflows and institutional participation, Bitcoin could see upward pressure toward $150,000 if market confidence remains intact.
Technical Levels to Watch
Short-term technical indicators, however, point to a fragile market. Analysts warn that a decisive break below the $110,000 support level could trigger further downside, potentially opening a range between $104,000 and $108,000. Conversely, reclaiming $115,000 would signal renewed bullish momentum and provide reassurance to investors concerned about the recent pullback.
The current market dynamics show a two-way, headline-driven environment, where news events, macro tensions, and large investor activity can sway prices in either direction. While put option demand highlights caution, call option concentration at higher strike prices suggests that institutions are hedging their positions rather than exiting, maintaining an underlying bullish bias.
Looking Ahead
Bitcoin’s resilience amid the recent turbulence demonstrates the complex interplay between macroeconomic pressures, investor sentiment, and structural market factors. While short-term volatility is likely to persist, analysts emphasize that the combination of ETF inflows, Fed policy expectations, and ongoing institutional support could help stabilize prices in the coming weeks.
Investors are advised to monitor key levels closely, particularly the $110,000 support and $115,000 resistance, as these benchmarks will help determine whether Bitcoin can maintain its current trajectory or enter a deeper correction phase. Meanwhile, the broader market may continue to reflect heightened sensitivity to macro news and headline developments, creating both risks and opportunities for traders navigating the space.
As the crypto market approaches the final quarter of the year, market participants are closely watching institutional trends, macro developments, and derivative flows to gauge the potential for recovery. The combination of selective selling by whales, rising put demand, and macro uncertainty underscores the need for careful positioning and risk management, even as structural demand supports the long-term outlook.
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