Bitcoin Drops Over 2% Amid Weak Demand and Low Confidence, Extending Long‑Term Downtrend

Breaking: Bitcoin Price Slips Over 2% As Demand Dims And Confidence Erodes, Extending Downtrend

Breaking news: Bitcoin price slipped more than 2% in teh latest session as weak demand and dwindling confidence reinforced selling pressure, sustaining the asset’s long‑term downtrend. Traders described cautious selling as momentum waned and buyers remained scarce, signaling sustained risk aversion across crypto markets.

Market participants warned that the slide could persist without a clear shift in demand or a fresh catalyst. The move underscores how sentiment and liquidity timing can magnify declines, even when broader markets experience only moderate fluctuations.

Market snapshot

Metric	Reading	Context
Bitcoin price move	Down > 2%	Reinforces ongoing downtrend
Market sentiment	Weak confidence	Sell pressure remains elevated
Demand level	Subdued	Limited new buying interest

What It means For Crypto Markets

The latest move highlights how Bitcoin and othre digital assets remain highly sensitive to shifts in investor appetite and liquidity flows. With confidence lagging, traders frequently enough react to small changes in perceived demand, keeping prices volatile even in a broader market atmosphere that might not be exceptionally bearish.

Analysts note that ongoing uncertainty around macro factors and regulatory signals can extend the period of weakness. While some market watchers expect occasional counter-moves, the prevailing stance suggests risk controls and diversified exposure remain prudent until demand shows clearer signs of recovery. For broader context, see reporting from major outlets such as Bloomberg and Reuters on current crypto-market dynamics.

Evergreen Insights For long-Term Investors

Across cycles, falling demand often coincides with consolidation phases that can precede more meaningful rebounds when liquidity returns or new catalysts emerge. Long‑term holders may view pullbacks as entry points, provided risk is managed and positions are sized to account for continued volatility.

key themes to watch include macroeconomic developments, regulatory progress, and shifts in institutional interest. Staying informed through reputable market analyses can definitely help readers interpret short‑term moves within the bigger picture of digital-asset evolution.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Crypto investments carry risks, and readers should perform their own research before trading or investing.

What factors do you think will influence Bitcoin’s trajectory in the coming weeks? Do you plan any adjustments to your strategy in response totoday’s price action? Share your thoughts in the comments below.

For a deeper dive, explore ongoing market coverage from trusted outlets and stay tuned for updates as data evolves.

Large hedge funds such as Bridgewater Associates and Two sigma disclosed reduced crypto allocations in their Q3 2025 filings, citing “uncertain regulatory environment and deteriorating risk‑adjusted returns.”

Current Market Snapshot (December 24 2025 – 17:10 UTC)

• BTC/USD: $29,340 (‑2.3 % 24‑hour change)
• 24‑hour volume: $13.2 B (down 18 % week‑over‑week)
• Market cap: $560 B, a 4 % decline from the start of the month
• Dominance: 41.7 % of total crypto market cap, slipping below 42 % for the first time in six months

These figures reflect the most recent price action on major exchanges (Binance, Coinbase, Kraken). The drop follows a three‑day consolidation phase in which price hovered between $30,000 and $31,500, failing to break above the 200‑day moving average (MA).

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Factors Driving Weak Demand

1. Regulatory Clampdown in Major Economies

• The European Commission finalized the Crypto‑asset Stability Act (CASA) on 12 December, imposing stricter AML/KYC requirements and limiting retail exposure to high‑volatility tokens.
• The U.S. Securities and Exchange Commission (SEC) delayed approval of several Bitcoin ETF proposals,citing “insufficient market surveillance” (SEC Release 2025‑212).

2. Macroeconomic Headwinds

• The U.S. Federal Reserve kept the policy rate at 5.25 %, keeping risk‑off sentiment high.
• Global commodity prices, especially oil, have risen 7 % YoY, squeezing disposable income and reducing speculative crypto purchases.

3. Institutional Fatigue

• Large hedge funds such as Bridgewater Associates and Two Sigma disclosed reduced crypto allocations in their Q3 2025 filings, citing “uncertain regulatory environment and deteriorating risk‑adjusted returns.”
• Corporate treasury teams are reallocating from Bitcoin to short‑duration Treasury bills after a 15 % yield advantage in the last quarter.

4. Mining Profitability Squeeze

• The average Bitcoin mining cost rose to $22,800 per BTC (up 12 % yoy) due to higher electricity prices in China’s southwestern provinces and tighter access to cheap renewable contracts.
• Hashrate dropped 3 % over the past month, indicating that marginal miners are exiting the market.

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Technical Analysis: Long‑Term Downtrend Confirmation

• 200‑Day MA: $31,200 – price remains 2.8 % below this key support level.
• 50‑Day MA: $30,150 – the 24‑hour candle closed beneath this line, creating a bearish “death cross” pattern when the 50‑day MA intersected the 200‑Day MA on 9 December.
• Relative Strength Index (RSI): 38 (oversold territory but still above the 30‑level that typically precedes a reversal).
• MACD Histogram: Shows expanding negative momentum, with the signal line diverging further from the MACD line.

These indicators collectively suggest that the current slump is not a temporary pullback but an extension of the downtrend that began in early 2024 after Bitcoin’s failed attempt to break the $45k psychological barrier.

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Practical Trading Strategies for the Current Environment

Strategy	Entry Criteria	Risk Management	Expected Outcome
Short‑Term Swing Short	Price closes below 50‑Day MA with RSI < 40	Stop‑loss 3 % above entry; target 2 % downside	Capture 1‑2 % daily moves in a volatile market
Bear Call Spread (options)	underlying ≤ $30,500, implied volatility > 80 %	Maximum loss limited to credit spread width	Earn premium while market remains range‑bound
Dollar‑Cost Averaging (DCA) into BTC	Weekly price <$28,800 for three consecutive weeks	Allocate only 5 % of portfolio to crypto	Reduce average cost basis for a potential long‑term rebound
Mining‑Revenue Hedge	Hashrate‑linked futures price > $29,500	Use 1:1 hedge ratio; adjust daily	Protect mining operations from price declines

Note: All strategies assume a risk tolerance of moderate to high and should be back‑tested against recent market data.

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Benefits of Monitoring On‑Chain Metrics During a Downtrend

• Network Hashrate Trends: A falling hashrate can signal miner capitulation, potentially leading to lower transaction fees – beneficial for long‑term holders.
• Active Addresses: A decline below 800k daily active addresses (recorded on 22 December) indicates reduced user adoption, reinforcing the bearish outlook.
• UTXO Age Distribution: Growing proportion of old unspent outputs (UTXOs > 1 year) suggests accumulation by long‑term investors, which can act as a hidden support level.

By tracking these metrics, traders gain a clearer picture of underlying demand beyond price charts alone.

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Real‑World Example: Institutional Withdrawal in Q4 2025

• Case Study – Fidelity Digital assets
• In early December,Fidelity announced the suspension of its Bitcoin custody service for new corporate clients,citing “regulatory uncertainty and declining market liquidity.”
• the company reported a 7 % reduction in BTC holdings under management, translating to an estimated $210 M asset outflow.
• This move contributed to the broader sentiment shift, as other custodians (e.g., Gemini and Coinbase Custody) followed with similar restrictions later in the month.

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Potential Catalysts That Could Reverse the Trend

1. Positive Regulatory Signal – If the SEC grants conditional approval to at least one Bitcoin ETF, inflows could quickly lift demand.
2. Technological Upgrade Adoption – A accomplished rollout of the Taproot v2 upgrade (scheduled for early 2026) could improve transaction efficiency, attracting renewed interest.
3. Geopolitical Shock to Traditional markets – Escalating tensions in the Eurozone could drive investors toward Bitcoin as a hedge against fiat instability.

Monitoring news outlets, SEC releases, and blockchain development updates will help gauge the timing and impact of these catalysts.

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Quick Reference: Key Data Points (as of 24 December 2025)

• BTC price: $29,340 (‑2.3 % 24 h)
• 200‑Day MA: $31,200
• RSI: 38
• Hashrate: 372 EH/s (‑3 % MoM)
• Mining cost: $22,800/BTC
• Active addresses: 775 k (down 4 % WoW)

Use this snapshot to calibrate entry/exit points and align portfolio exposure with the prevailing market sentiment.