Bitcoin Faces Potential Decline to $10,000 Amid Market Volatility
Bitcoin currently trades around $87,000 after briefly reaching $90,000, but there are growing concerns about further declines into early 2026. Market data reveals a heavy build-up of put options at the $85,000 strike for the December 26 expiry, indicating expectations that Bitcoin might dip below this level. The 30-day implied volatility sits near 45% with a negative skew, reflecting strong demand for downside protection; longer-dated skew around -5% suggests bearish sentiment extending into the first half of 2026.
According to Bloomberg Intelligence's Mike McGlone, while a rally above $100,000 could still occur, it might precede a deeper retracement toward $10,000 sometime in 2026. This potential downturn is expected to be driven primarily by highly speculative digital assets. Bitcoin has already fallen roughly 5% throughout 2025 through mid-December. On-chain data from Glassnode shows that short-term holders are currently in losses, and about 500,000 BTC have shifted out of long-term holders since July.
Ether demonstrates a slightly more balanced market positioning. Puts around the $2,500 mark for the December 26 expiry reflect some concern, but the longer-dated skew is closer to neutral.
The Federal Reserve’s recent rate cuts are seen as signals that monetary tightening may be over, permitting more risk exposure. However, leverage remains high and the sharp liquidation in October highlighted the fragility of price discovery in a crowded market.
Overall, geopolitical risks and leverage conditions are cited as key drivers of ongoing volatility, keeping downside risks in focus as 2025 draws to a close and the market approaches 2026.
