Crypto markets remained under pressure as bitcoin hovered near $87,000, with options positioning and analyst commentary pointing to growing risks of a deeper downturn through early 2026.
The recent rebound appears to be losing momentum, with price action increasingly defined by short-lived rebounds followed by resumptions of selling, as CoinDesk reported on Wednesday.
Bitcoin briefly climbed to $90,000 late Wednesday before falling back below $87,000, underperforming stock markets during the latest bout of macro uncertainty. Traders are increasingly positioning themselves for further declines, especially around the December 26 options expiration.
Data from derivatives markets shows a strong accumulation of put options at the $85,000 strike price, suggesting that bitcoin could fall below this level in the near term.
Thirty-day implied volatility has climbed as high as 45%, Derive.xyz said in an email to CoinDesk, while skewness remains firmly negative, reflecting demand for downside protection. The longer-term skew is also anchored near -5%, indicating that bearish sentiment extends into the first half of next year.
“There is a clear defensive positioning for the end of the year,” said Alex Kuptsikevich, chief market analyst at FxPro. “The uptrend that formed in late November has been broken, and the market is now trading more like it did during the October selloff, with sharp rebounds that have failed to gain traction.”
Ether shows a slightly more balanced profile. While short-term ETH skew remains negative, long-term skew is closer to neutral, suggesting less conviction around a lasting slowdown.
Nonetheless, traders accumulated a large group of puts around the $2,500 level for the December 26 expiration, highlighting a key area of concern.
Beyond short-term positioning, some analysts warn that Bitcoin’s long-term cycle may be reversing. Mike McGlone, a commodities strategist at Bloomberg Intelligence, said the rally above $100,000 earlier this year could have sowed the seeds of a much deeper retracement.
“Bitcoin’s surge toward the six figures may have triggered a cycle back toward $10,000, potentially in 2026,” McGlone said, arguing that periods of extreme wealth creation are often followed by sharp reversions. He added that the next economic downturn could be caused by a collapse of highly speculative digital assets whose supply is effectively unlimited.
Despite the warning, McGlone noted that bitcoin itself has been relatively resilient, down only about 5% in 2025 through mid-December.
Still, CryptoQuant data shows that short-term holders have been suffering losses for over a month, while Glassnode estimates that long-term holders have lost around 500,000 BTC since July.
Meanwhile, FxPro’s Kuptsikevich said the Federal Reserve’s rate cuts this year mattered less as a direct catalyst than as a signal that the tightening was over, allowing investors to maintain risk exposure via withdrawals.
“This patience helped propel bitcoin to new highs earlier in the year,” he said. “But leverage remains high, and October’s selloff revealed how fragile price discovery can be when positioning is saturated.”
Looking ahead, geopolitical risks and debt conditions will be key factors in 2026. For now, markets appear poised for volatility, with downside risks once again in focus as the year draws to a close.
