69,000 Bitcoins to be sold, will Bitcoin fall to $70,000?

The bell of 2025 rang, but the market seemed to have entered garbage time.

Even Bitcoin did not expect that $100,000 would become the criterion for judging bulls and bears. It was thought that Bitcoin's standing above $100,000 on Monday was the beginning of the next rising wave, but it was unexpected that Bitcoin began to run out of energy before it had bounced for two days. During the U.S. trading session on Tuesday, the intraday low hit $92,600, down nearly 10% from the high of more than $102,000 on Monday in two days, and now reported $94,212.

Bitcoin watched from the other side, while altcoins surrendered. ETH returned to $3,300, SOL came below $200, and the altcoin sector fell 10%, with institutional tokens such as ADA, RNDR, and Aptos leading the decline. Even the U.S. stock market was affected, and the share prices of leading mining companies such as TeraWulf, Bit Digital, Bitdeer, IREN, and Hut 8 also fell 5-8%. Although the decline is still controllable, as the low point of Bitcoin is close to the price before the New Year, market sentiment is also receding in the high tide. The sale of Silk Road has also poured cold water on the market. There are discussions in the market, and even many analysts believe that Bitcoin will fall to $70,000 before Trump's inauguration speech. For example, analyst Ali Martinez said that the key support area of ​​BTC is currently hovering between $97,041 and $93,806. He believes that if Bitcoin cannot meet this demand, it will fall sharply to $70,085.

To see whether the prediction will come true, we must first analyze the reasons for this round of decline.

The market generally believes that the macro data released on Tuesday was the trigger for this decline. The report released by the U.S. Bureau of Labor Statistics showed that the number of JOLTS job vacancies in the United States in November exceeded 8 million, significantly exceeding expectations and exceeding the estimates of all economists surveyed by the media, setting a six-month high. This JOLTS data was mainly driven by the growth of the business services industry, while the demand for workers in other industries was mixed.

The number of JOLTS job vacancies in the United States in November was 8.098 million, which was expected to be 7.74 million. The previous value in October was revised up from 7.744 million to 7.8 million. The job vacancies in November continued the rebound trend in October. In September, JOLTS job vacancies unexpectedly fell sharply, hitting a new low in more than three years, triggering recession fears.

Also released with JOLTS is the US ISM Services PMI. The ISM Services Index recorded 54.1 in December, higher than the market expectation of 53.3 and the previous 52.1. This growth was mainly due to the significant increase in the sub-index of service prices paid, which jumped from 58.2 in November to 64.4, reaching the highest level since February 2023.

Overall, the macro data can be described as bright, but it is such bright data that has led to a decline in the market. The market generally believes that due to the strong support of macro data, the Federal Reserve is very likely to continue to maintain a hawkish stance, so it is necessary to reprice the path of interest rate cuts. In other words, if the macro environment improves, there is no need to open the floodgates, but the liquidity shock to risky assets is difficult to avoid. After the data was released, traders no longer bet that the Fed would cut interest rates before July. The S&P 500 and Nasdaq fell, in contrast to the soaring U.S. 10-year Treasury yield and the U.S. dollar index. Coincidentally, today the Federal Reserve released the minutes of the Federal Open Market Committee (FOMC) policy meeting in December last year, which was basically the same as last month, and made it clear that interest rate cuts would become more cautious. Committee members expect the pace of interest rate cuts in 2025 to slow significantly, with only 75 basis points expected to be cut throughout the year. Macroeconomics is the key background, but Trump, who never stops making shocking remarks, has further stimulated the risk aversion of capital. Just yesterday, according to CNN, four sources revealed that U.S. President-elect Trump is considering declaring a "national economic emergency" to provide a legal basis for his widespread imposition of large tariffs on allies and competitors. The report stated that after the United States enters a "national economic emergency", Trump will be allowed to use the International Economic Emergency Powers Act (IEEPA) to formulate a new tariff plan. IEEPA unilaterally authorizes the US president to manage imports during the relevant national emergency." On January 7, at a 70-minute press conference at Mar-a-Lago in Florida, Trump made even more outrageous remarks. He not only said that "economic means would be used" to make Canada the 51st state of the United States, but also did not rule out the use of force to seize the Panama Canal and Greenland. He also promised to rename the Gulf of Mexico as the "American Gulf." The Middle East issue cannot be let go. He emphasized that if Hamas does not release the Israeli hostages before he takes office, "the Middle East will fall into chaos." Such arrogant words successfully attracted public opinion siege from Canada, Denmark and other countries after the press conference, and also made the market worried about the trend of the global economy. Due to the uncertainty of the impact of macro interest rate cuts and tariffs, the market's risk aversion sentiment is prominent. The three major US stock indexes fluctuated and weakened, the US dollar index rose sharply, and non-US currencies plunged. The crypto market is naturally not immune. ETFs representing institutional funds also showed this point. On January 8, the US Bitcoin spot ETF had a net outflow of US$583 million in a single day, and the Ethereum spot ETF had a net outflow of US$159 million in a single day. Both funds have an outflow trend.

Another incident that made matters worse was this morning, DB News said that according to an official, the US Department of Justice has been approved to liquidate 69,370 BTC seized in the Silk Road case, with a total value of approximately US$6.5 billion.The rumors are not groundless. As early as December 3, the US government transferred 19,800 SilkRoad-related bitcoins worth nearly US$2 billion to Coinbase Prime, the market interpreted it as the government's preparation for sale at that time. The expected increase in selling pressure has intensified market panic, and BTC fell by more than 1% in a short period of time, hitting below $94,000 again.

Although the panic has not diminished, from the current stage, there are less than 10 days before Trump's official swearing-in and inauguration speech, and February is the earnings season, the market outlook is still relatively more optimistic than bearish. From the news perspective, the positive information is still supported.

The main line and key nodes of transactions in 2025, picture source: CICC

First, the lawsuit between Coinbase and the SEC has ushered in a turning point. The U.S. District Court for the Southern District of New York approved Coinbase's non-interlocutory appeal motion, and it can appeal to the Second Circuit Court against the SEC's allegations. During this period, the case is temporarily suspended. The reason is that the judge believes that there are differences in the legality of cryptocurrencies in different courts across the country, so this legality needs to be ruled. If the Second Circuit Court agrees to hear the case, the federal government will have the opportunity to resolve the controlling legal issue of the scope of the SEC's statutory power over digital assets. It is worth noting that since this is an appeal in the middle of the lawsuit, it will greatly increase the possibility of the case being dismissed, and the SEC will face a very passive situation at that time. If the appeal is successful, the SEC's question about the securities attributes of the currency listed on Coinbase may also be solved, and the altcoin ETF will be expected to be promoted.

Second, the chairman of the CTFC, who once strived to become the highest regulatory agency for cryptocurrencies, resigned, but in his last public speech, he still expressed positive emotions about crypto regulation, and the Trump team has begun to look for a successor chairman who is friendly to cryptocurrencies. Current CFTC Commissioner Summer Mersinger, a16z Crypto Policy Director and former CFTC Commissioner Brian Quintenz, and Kraken's Chief Legal Officer Marco Santori are all under consideration. It can be seen that the Trump team has a highly unified consensus on the unbundling of crypto regulation.

Against this background, the attitude of whales towards the future trend of Bitcoin can be described as quite positive, and picking up leaks and bottom-fishing have become common operations of whales.

Data compiled by @Phyrex_Ni show that panic sentiment is obvious among small holders. During the decline in the past two days, investors holding less than 10 BTC have a clear trend of reducing their holdings, and the holdings of exchanges have continued to decline, but large holders are relatively confident, and investors with more than 10 BTC have a clear trend of increasing their holdings.

Cauê Oliveira, head of research at Blocktrends, confirmed this data, saying that at the end of 2024, institutional investors sold a large amount of Bitcoin, but are now starting to buy it at a price below $100,000. In the week after December 21, wallets holding 1,000 to 10,000 BTC sold 79,000 BTC, but recently, this group has been hoarding when the price of Bitcoin is below $95,000.

As for the Silk Road that caused panic, the impact may not be as great as expected. First, Trump has publicly promised that the US government will not sell any Bitcoin after his election. This move is undoubtedly a slap in the face, and there may be a reversal in the future. Even if it is confirmed that it can be sold, it will not be done overnight in terms of time, and it may take several months of approval process. Secondly, in order to maximize profits, large-scale sales are usually purchased over the counter, and the impact on prices is relatively controllable. In addition, even if it is a one-time entry into the market, it will only take more than a week based on the current liquidity, so there is no need to cause panic. Ki Young Ju, CEO of CryptoQuant, said, "Based on the realized market value, $379 billion entered the market last year, with about $1 billion in liquidity every day. The $6.5 billion (Bitcoin) sold by the US government may be absorbed within a week."

Therefore, some institutions are very optimistic and believe that the decline caused by selling pressure is a buying opportunity. Arthur Hayes, co-founder of BitMEX, wrote in response to Silk Road's entry into the market, "Diamond Hand is ready to buy at the bottom."

Overall, although the mood has fallen and there is indeed panic, with the support of institutions and whales buying at the bottom, even if the crypto market falls, it is highly likely that it will not usher in an avalanche. The current bottoming concentration area of ​​Bitcoin is still around $95,000, and the price is mostly based on this. A large drop may return to the fluctuation below $90,000, but the probability of $70,000-80,000 is small.

In addition to the continued attention to Trump's administration, the next important event to observe in the market is the US non-farm payrolls report for December released on Friday night. Although the ADP "small non-farm" data on Wednesday was lower than expected, which gave the market a slight relief, the big non-farm data often differs greatly from the ADP, and the non-farm data is one of the key factors in the Fed's policy decisions, so it is the focus of the market. The job market that is lower than expected may make the Fed turn dovish again.

At present, the market generally expects that the number of new non-farm jobs in the United States in December will slow to 153,000, and the unemployment rate will remain at 4.2%.