Bitcoin falls below the 90,000 USD mark: Is the Bear Market arriving or is it a good opportunity for positioning?

In December, the crypto market welcomed a key node amidst the festive atmosphere. As of December 23, the price of Bitcoin fell below 90,000 USD, with the market oscillating between short-term Unfavourable Information and long-term optimism.

01 Market Sentiment and Key Data

The price trend of Bitcoin is a barometer of market sentiment. According to Gate.io market data, on December 23, the price of Bitcoin fell below $90,000, reporting $87,930.

The market sentiment indicator is sending mixed signals. The Fear and Greed Index currently stands at 24, indicating that the market is generally in a state of fear. Historical data shows that this level of sentiment is often associated with market accumulation periods.

The on-chain data analysis firm Santiment points out that a concerning signal is that Bitcoin is continuously flowing to exchanges. In the past 10 days, net inflows of Bitcoin to exchanges exceeded 17,700 coins. An increase in exchange supply is typically seen as a potential selling pressure signal.

02 Fund Flow and Technical Analysis

From a technical analysis perspective, the market is currently in a critical support and resistance range game. According to the analysts on Gate Square, Bitcoin's key support level is currently located in the range of $81,000 to $85,000.

Once it falls below 81,000 USD, the market may further test the range of 75,000 to 80,000 USD. Resistance is concentrated in the area of 90,000 to 94,000 USD.

The funding rate data reveals the sentiment bias of traders. Current data shows a slight bullish bias in the market. This is not entirely a positive signal, as a strong rebound is often driven by “short squeezes,” and the current market lacks sufficient short positions to provide the fuel for such a rebound.

03 Macroeconomic Influencing Factors

The crypto market has never operated independently of traditional macroeconomics. The tightening liquidity at the end of the year and the hawkish expectations from the Federal Reserve constitute the main macro pressures currently faced by the market.

At the same time, the dynamics in the traditional financial sector also bring structural advantages. The Federal Reserve has officially ended its three-year quantitative tightening (QT) policy. Several global commercial banks have been reported to be piloting integration projects such as custody and on-chain settlement with mainstream crypto platforms.

The regulatory environment is also undergoing positive changes. The UK has passed laws recognizing cryptocurrencies as legal “property,” while Japan has significantly reduced the tax rate on crypto assets from 55% to 20%. The clarification of regulations lays the foundation for the long-term influx of institutional funds.

04 Institutional Behavior and On-chain Signals

In market fluctuations, the movements of “smart money” often have a forward-looking nature. Current on-chain data shows significant differentiation: large holders of Ethereum are actively accumulating assets.

Since mid-November, wallet addresses holding between 1,000 and 1,000,000 ETH have seen a continuous increase in balance, while smaller retail wallets have been selling. This pattern of “large funds buying and small funds selling” is often viewed as a potential bullish signal.

The fundamental aspects of the Ethereum network are also showing resilience. Its 50-day average number of new addresses has reached a new high for the year. A similar peak in network growth occurred in mid-2025, after which the price of Ethereum doubled within two months.

05 Short-term Strategies and Long-term Outlook

In the face of the current market, Gate Square's analysis provides a clear cyclical framework. In the short term, the market may present a “fluctuating bottoming” pattern within 1 to 3 months, influenced by year-end liquidity tightening and outflows of ETF funds.

The medium-term outlook has turned optimistic. Analysts believe that over the next 3 to 12 months, as macro rate cut expectations rise and regulatory compliance advances, the market is expected to gradually stabilize and recover. The medium-term benchmark target range for Bitcoin is between 110,000 and 140,000 dollars.

The long-term perspective paints a picture of an “institutionalized slow bull”. In the next 1 to 3 years, the core driving force of the industry may shift from speculation to practical value and institutional dominance. The expansion of compliant products such as spot ETFs and the tokenization of real-world assets (RWA) will become a major trend.

The short-term market slump has not changed the course of action for major financial institutions. BlackRock's CEO publicly acknowledged that his view on Bitcoin “has completely changed.” Charles Schwab announced that it will offer Bitcoin and Ethereum trading services in early 2026.

These signals clearly point in one direction: traditional finance is making substantive preparations for comprehensive access to the encryption world.

The volatility of the crypto market is an inherent characteristic, but within the fluctuations lies the opportunity for structural transformation. A new stage of encryption driven by institutions, compliance, and real-world applications is becoming increasingly clear.