Bitcoin price news: BTC slips below $88,000, but Strategy, Circle, Gemini among those sharply lower

Bitcoin Dips Below $88K: What’s Driving the Crypto Sell-Off?

In the latest , amid a broader crypto market downturn. Over the past 24 hours, Bitcoin has shed around 1%, trading just shy of that key psychological level. But the pain isn’t limited to BTC—crypto-related stocks like , , and are plunging even harder, signaling deeper concerns in the sector.

Market Snapshot: BTC vs. Traditional Assets

Bitcoin’s slide stands in stark contrast to surging commodities. Gold, silver, and copper all hit record highs earlier today before a slight pullback in afternoon trading. Meanwhile, U.S. stocks are modestly higher, with the Nasdaq up 0.45%. This divergence highlights crypto’s unique vulnerability right now, even as risk appetite appears intact elsewhere.

The total crypto market cap sits at around $2.6 trillion, down from early October peaks. Investors are watching closely as year-end pressures mount.

Crypto Stocks Take a Beating: , , Lead Declines

While BTC’s 1% drop might seem mild, crypto-exposed equities tell a different story. Digital asset treasury firms—the year’s biggest losers—are getting hammered:

• Strategy (MSTR): Down 4.2%
• XXI (XXI): Off 7.8%
• ETHZilla (ETHZ): Plunging 16%
• Upexi: Falling 9%

Other notable decliners include , , and Bullish (BLSH), each down about 6%. These sharp moves suggest investors are rotating out of high-beta crypto plays amid thinning liquidity.

Tax-Loss Harvesting: The Year-End Culprit?

Analysts point to tax-loss harvesting as a key driver. With markets illiquid heading into holidays, portfolio managers are offloading underwater positions to book losses and cut tax bills. As Paul Howard, senior director at trading firm Wincent, notes:

“The end of the year often prompts PMs to trim risk assets—not just for holidays, but to create taxable events and clean up balance sheets that might not want crypto exposure showing up.”

This strategy intensifies in low-volume periods, amplifying downside pressure on and altcoins alike.

Thinning Leverage and Options Drama

Adding fuel to the fire: Open interest in BTC and ETH perpetual futures has cratered—down $3 billion and $2 billion, respectively. This deleveraging leaves markets prone to wild swings from big trades.

Friday’s massive Boxing Day options expiry on Deribit, representing over 50% of total open interest, heightens the risk. Downside bets have eased, but lingering $100,000 BTC calls hint at faint hopes for a Santa rally. Still, experts like those at QCP Capital predict any spikes will fade:

“Holiday moves typically mean-revert as liquidity floods back in January.”

Macro Backdrop: Trump’s Fed Push Amid Hot Economy

U.S. President Donald Trump weighed in on Truth Social, urging his incoming Fed chair pick to slash rates when markets thrive. “I want my new Fed Chairman to lower Interest Rates if the Market is doing well, not destroy the Market for no reason,” he posted.

This comes hot on the heels of strong economic data: Inflation-adjusted GDP grew at a 4.3% annualized pace in Q3, per the Bureau of Labor Statistics. Trump lamented how good news now spooks markets fearing rate hikes to curb ‘potential’ inflation.

Despite S&P 500 and Nasdaq gains today, caution lingers over limited rate cuts in 2026. Crypto, sensitive to liquidity, feels the pinch most acutely.

2025 Blockchain Recap: Progress Without Price Pops

Looking back, 2025 was a tale of two realities for blockchains. Layer-1 tokens largely underperformed despite regulatory wins, institutional inflows, and rising TVL. Major ecosystems saw structural gains—protocol revenues, app growth, and adoption mechanics—but token prices stayed flat or negative.

This ‘decoupling’ between usage and value raises questions for 2026. Key narratives like institutional on-ramps and ecosystem TVL will be watched closely.

Bullish 2026 Outlook: Bitcoin as Top Performer?

Bright spots emerge on the horizon. VanEck’s David Schassler predicts Bitcoin will shine in 2026 after a tough 2025, alongside gold. Rising demand for ‘hard assets’ amid economic uncertainty could spark a rebound.

Wincent’s Howard tempers enthusiasm, forecasting consolidation: “It’ll take months to climb back to a $4 trillion market cap from $2.6 trillion—no quick catalysts in sight.”

What’s Next for BTC Price?

like today’s dip below $88K underscores crypto’s volatility, but fundamentals remain solid. Tax harvesting and thin books explain short-term pain, while macro rate debates and 2026 optimism offer hope.

Traders should eye January liquidity return and options expiry fallout. For long-term holders, this could be a buying dip before the next leg up. Stay tuned for more updates as markets evolve.

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