Experts name the main reasons for the collapse of Bitcoin prices

Bitcoin (BTC) experienced another sharp pullback, falling below $90,000. The event coincided with increased macroeconomic uncertainty, reduced liquidity, and high levels of forced liquidations.

Bitcoin (BTC) experienced another sharp pullback, falling below $90,000. The event coincided with increased macroeconomic uncertainty, reduced liquidity, and high levels of forced liquidations.

Analysts from MEXC Research and Bitget Research explained what happened and how it could affect future market dynamics.

Why Bitcoin fell: key factors

MEXC Research Chief Analyst Sean Yang notes that the current decline is the result of a combination of macroeconomic and market factors, as well as increased fear among investors. In his opinion, the market came under pressure in several areas at once.

1. Macroeconomic uncertainty
The analyst explains that global markets are under pressure due to expectations of tighter monetary policy and possible interest rate hikes. The strengthening of the dollar reduces interest in risky assets and forces investors to move capital into more stable instruments.

2. Decline in institutional flows
According to Yang, after a period of active institutional demand, some funds are taking profits. He points out that institutional capital inflows are slowing, which indicates that large players are partially exiting their positions at peak valuations.

3. Regulatory risk
The expert adds that the start of discussions around the regulation of stablecoins, crypto ETFs, and exchanges is increasing uncertainty and putting pressure on the market.

4. Technical correction
Bitcoin may have been overbought after the recent rally.

“Technical indicators are showing signs of overbought conditions, and some market participants are using the correction to lock in profits,” he explained.

According to Yang, such a pullback is a “healthy” technical phenomenon after strong growth.

5. Market fear
The analyst emphasizes that psychological factors often amplify declines. News coverage and panic sentiment are pushing some holders to sell.

6. Liquidity on exchanges
He also points to a possible outflow of liquidity from exchanges, which reduces the possibility of quick purchases and accelerates the decline.

What could change market dynamics

Bitcoin price forecasts:

Short term (1-3 months). Yang expects further volatility with the possibility of support forming in the $85,000–90,000 range. If there are positive signals, a rebound to $100,000 is possible.

Medium term (6-12 months). Under favorable conditions, the first cryptocurrency could return to $120,000–140,000. In a more conservative scenario, the range would be $80,000–110,000.

Long term (1-3 years). If the trends of Web3, institutional adoption, and decentralized finance continue, Bitcoin could rise above $200,000. In a less optimistic scenario, consolidation in the $100,000–150,000 range is expected.

Yang lists the key reversal triggers:

• positive regulatory news and ETF approval;
• interest rate cuts and policy easing;
• growth in institutional inflows;
• development of L1/L2 infrastructure and strengthening of Bitcoin's role as “digital gold” or as a reserve asset.

Why is the price falling in the first place?

Bitget Research lead analyst Ryan Lee views the current market movement as a reaction to a combination of fundamental and market factors.

According to him, the main pressure is coming from:

• macroeconomic uncertainties,
• liquidity pressure,
• and local structural imbalances.

Macroeconomics and the strengthening of the dollar

Lee notes that rising US bond yields and expectations of a tougher stance by the Fed automatically reduce interest in risky assets, including cryptocurrencies. Institutional investors “reduce their exposure” during such periods, which exacerbates turbulence.

Cascade of liquidations

The expert says the market faced a massive closure of long positions. This created a chain reaction and accelerated the downward movement.

“When the market structure is overheated, even small events can cause a chain reaction,” he noted.

Decline in spot demand

After a period of heightened enthusiasm around ETFs and network upgrades, some investors decided to take profits. This amplified the natural correction.

“Combined with a decline in new inflows, this created a natural correction,” Lee explained.

The psychological component

The expert emphasizes that in times of uncertainty, markets become more sensitive to news, and algorithmic trading amplifies volatility.

At the same time, he considers the current decline to be a normal part of the market structure.

“The current decline is part of the normal market cycle. For Bitcoin, such phases have historically been an integral part of growth: periods of overheating have always been followed by a correction that redistributed liquidity and cleared the market of excessive leverage,” he concluded.

Editor: Alyona Nabok

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