In the early hours of December 18 Beijing time, the Bitcoin price once again slipped below the key $86,000 psychological level amid ongoing volatility. According to Gate market data, BTC/USDT hit a low of $85,993, marking a 24-hour drop of 1.92%.
Most market analysts believe this decline stems from a combination of factors: ongoing profit-taking by long-term holders, weakening market liquidity, and anticipation of upcoming macroeconomic data releases.
01 Price Dynamics: Bitcoin Slides Amid Volatility
On December 18, Bitcoin experienced significant price swings. Gate market data shows that BTC briefly fell below $86,000 in the early morning hours, and was last reported at $86,993, down 1.92% over 24 hours.
This decline was not a straight drop. The price rebounded to $86,159.5 later that morning but failed to sustain a breakout above the $86,000 mark, highlighting intense market tussle around this level.
Compared to the all-time high above $126,000 set in October, Bitcoin has pulled back nearly 30%, entering a correction phase. The price is currently locked in a tug-of-war between $85,000 and $87,000, as the market searches for clear direction.
02 Key Driver: Wave of Profit-Taking by Long-Term Holders
Blockchain data shows that Bitcoin held for several years is returning to the market at a pace rarely seen in recent years. Since the start of 2023, the number of bitcoins unmoved for at least two years has dropped by about 1.6 million coins—worth roughly $140 billion at current prices.
In 2025 alone, nearly $300 billion worth of Bitcoin that had been dormant for over a year has re-entered circulation. Blockchain analytics firm CryptoQuant notes that, over the past 30 days, long-term holders have sold at one of the highest levels in over five years.
K33 Senior Analyst Vetle Lunde points out that, unlike previous cycles, this round of "awakening sell-offs" has been fueled by deep liquidity from US ETFs and institutional capital, enabling early investors to realize gains in the six-figure price range.
03 Market Context: Shrinking Liquidity and Participation
Over the past year, selling by long-term holders was largely absorbed by demand from newly launched Bitcoin ETFs and crypto investment institutions. Recently, however, the situation has shifted: ETF flows have turned negative, derivatives trading volumes have dropped, and retail participation has clearly weakened.
According to Coinglass, open interest in Bitcoin options and perpetual contracts remains well below levels seen before October’s sharp decline. This suggests many traders remain on the sidelines, while derivatives still account for the majority of crypto trading volume.
Chris Newhouse, Head of Research at decentralized finance think tank Ergonia, describes the current market as undergoing a "slow bleed"—spot Bitcoin continues to be sold off, but buy-side liquidity remains thin.
04 Technical Outlook: Key Support and Potential Rebound
From a technical analysis perspective, the $85,000–$86,000 zone forms the most critical short-term support. Gate Research notes that if this range holds, a technical rebound in the short term cannot be ruled out.
However, if the $85,000 support fails, prices could fall further toward the $82,000–$80,000 demand zone. The market remains in a clear downward channel, with repeated rejections near the upper boundary (around $90,000).
On the technical indicator front, the MACD has formed another bearish crossover, with the histogram staying below the zero line, indicating that downward pressure has yet to be fully released. The price is moving along the lower Bollinger Band, and both bands are narrowing, signaling continued volatility compression.
The table below summarizes the key price levels and market structure for Bitcoin:
| Analysis Dimension | Current Status | Key Level | Market Implication |
|---|---|---|---|
| Short-term Support | Being tested | $85,000–$86,000 | Breach could see a move to $82,000–$80,000 |
| Short-term Resistance | Repeatedly rejected | Around $90,000 (upper channel boundary) | Sellers remain in control; bearish trend intact |
| Medium-term Resistance | Still present | $100,000 (100-day & 200-day moving averages) | Forms significant dynamic resistance, trending lower |
| Market Structure | Weak, range-bound | Price along lower Bollinger Band | Volatility compression building energy for breakout |
05 Institutional Moves: Contrarian Capital Flows
Despite overall market pressure, some institutional investors are taking contrarian positions. According to Gate Research’s weekly report, BitMine has increased its holdings by another 102,259 ETH, while Strategy has added more than 10,000 BTC for two consecutive weeks.
The convergence of traditional finance and crypto is also accelerating. Securities lending infrastructure giant EquiLend has announced a strategic minority investment in regulated crypto financing provider Digital Prime Technologies.
This partnership aims to connect the roughly $40 trillion capital pool of traditional financial markets with the tokenized asset space via the Tokenet institutional lending network, signaling a rapid opening of institutional capital to on-chain credit, clearing, and asset-backed trading mechanisms.
06 Outlook: Is the Selling Pressure Nearing an End?
K33 Senior Analyst Vetle Lunde believes the wave of selling by long-term holders may be nearing its end. Based on historical on-chain data, he notes that about 20% of Bitcoin’s supply has been reactivated over the past two years, approaching a key threshold.
Looking ahead, selling pressure from long-term holders appears to be reaching saturation. Lunde expects that by 2026, concentrated selling by early investors will have significantly diminished.
As Bitcoin becomes further integrated into institutional investment frameworks, the amount of coins held for more than two years is likely to rebound, and the market structure may gradually shift toward net buying dominance. This structural change could lay the groundwork for the next bull market.
Outlook
After a brief rebound in the early hours, Bitcoin prices slid again during morning trading. At the time of writing, Bitcoin was hovering near $86,000, reflecting fierce competition around this key level.
Traders are now focused on the upcoming release of US economic data. According to Glassnode, holders with between 100 and 1,000 BTC have increased their holdings by 54,000 BTC over the past seven days.
Total holdings by these investors rose from 3.521 million to 3.575 million BTC, marking the highest cumulative level since 2012. This data suggests that there is still underlying support within the market’s deeper structure.
