Bitcoin (BTC) has recently dropped to just under $98,000, marking a nearly 10% pullback from its all-time high, raising concerns among investors about the sustainability of the current bull run.
The decline is partly attributed to concerns over China’s DeepSeek AI model, which is seen as a potential competitor to the U.S. industry, operating at a significantly lower cost. Since President Donald Trump’s election win, Bitcoin has surged from $66,000 to a record high of $109,000. However, during this period, Bitcoin has experienced two separate 15% corrections and several other notable pullbacks, making the current 10% drop seem in line with past fluctuations.
One key metric to watch in a bull market is the short-term holder cost basis, which reflects the average cost for Bitcoin that has moved within the last 155 days. Currently, this level is around $91,000, meaning if Bitcoin dips below this price, it could potentially challenge the ongoing bull market.
Bearish sentiment is rising, as Bitcoin’s funding rates have turned negative. Notable figures such as Arthur Hayes, co-founder of Bitmex, have predicted a correction to the $70,000-$75,000 range before Bitcoin could potentially reach $250,000. Additionally, CoinDesk’s Omkar Godbole has pointed out that a “double top” bearish reversal pattern could drive Bitcoin’s price down to $75,000.
This downturn isn’t limited to the cryptocurrency market; U.S. stock markets are also experiencing sell-offs, with Nasdaq futures dropping by as much as 4%.
