Bitcoin News Today: Bitcoin Dips Below $85K as ETF Inflows Fail to Stem Broader Crypto Selloff

The crypto market faced another significant downturn overnight, with Bitcoin falling below $85,000 and the total market cap dropping below $3 trillion. This follows a week of selling pressure and a broader shift in investor sentiment. Analysts noted the market's struggle to hold key support levels, signaling ongoing uncertainty.

Bitcoin's decline was exacerbated by a broader risk-off environment, as traders shifted capital away from high-beta assets. Institutional investors also appeared to adopt a more defensive stance, with notable outflows from Bitcoin ETFs. The price action has sparked renewed debate over whether the market is in a deep correction or a temporary pullback.

Market observers are closely monitoring the implications of this downturn for altcoins, which have been hit particularly hard. Several tokens posted double-digit losses, with Ethereum sliding below $3,000 and other major names like XRP and Solana also under pressure. The broader crypto economy is now in a consolidation phase, with traders assessing the next moves.

Market Sentiment and Technical Outlook

The crypto market has struggled to maintain an upward trend, with Bitcoin's recent break below key technical levels triggering further selling.

The 78.6% Fibonacci retracement at $85,569 has become a critical zone, and analysts are watching to see if buyers can stabilize the price. Glassnode's analysis suggests that Bitcoin is caught in a range bound by strong selling pressure above $95,000 and support near $81,000.

The market's sentiment index has fallen to 16, its lowest in almost three weeks. This indicates a cyclical weakness in the crypto space, reminiscent of the conditions seen at the end of 2021. The lack of a clear catalyst for the current selloff has raised concerns among investors, particularly as leverage unwinding continues to weigh on prices.

Institutional Inflows and ETF Activity

Despite the near-term bearish pressure, institutional demand for Bitcoin has shown early signs of recovery. Spot Bitcoin ETFs recorded a net inflow of $457 million on Wednesday, breaking a two-day outflow streak and offering some support to the price. Fidelity's FBTC and BlackRock's IBIT led the inflows, with over $500 million in combined inflows.

However, the same data shows that Ethereum ETFs recorded a net outflow of $22.4 million, their fifth consecutive outflow. This contrast highlights the diverging trends in the market, with Bitcoin attracting capital while altcoins struggle. Analysts suggest that the inflows into Bitcoin ETFs could provide a foundation for a potential rebound, but significant resistance remains above $90,000.

Altcoin Weakness and Market Correction

The recent selloff has hit altcoins particularly hard, with several tokens posting double-digit declines. Ethereum led the list of liquidations, with over $171 million in derivatives trades erased. Solana, XRP, and other major names also faced significant selling pressure as traders rotated into Bitcoin and cash. The broader market correction has pushed the total crypto market cap to around $2.93 trillion, a decline of over 3% in a single day. This represents a 15% drop in the past 30 days, indicating a deeper correction phase. Analysts from Binance Research have noted that this phase could extend if Bitcoin fails to regain key support levels.

Analysts' Views and Future Outlook

Market analysts remain divided on the implications of the current selloff. Some believe the market is in a bearish correction, while others see this as a necessary consolidation before the next bullish phase. Joe DiPasquale of BitBull Capital attributes, the recent pullback to a mix of macroeconomic pressure and positioning, noting the role of leveraged longs in accelerating the downside move.

Gabriel Selby of CF Benchmarks emphasized the technical nature of the recent price action, particularly around the CME weekend opening gap. He expects Bitcoin to remain in a range-bound pattern until fresh liquidity absorbs the overhead supply. If this scenario unfolds, the price could remain sideways between $85,500 and $90,000 for an extended period.

The relative strength index (RSI) currently stands at 40, indicating bearish momentum is gaining traction. A break below $85,569 could extend the decline toward the psychological $80,000 level, opening the door for further selling. Analysts are closely monitoring this technical threshold and any signs of institutional buying that could shift the balance of power.

Institutional Sentiment and Regulatory Outlook

Despite the short-term pessimism, institutional sentiment remains constructive. Major banks in Brazil and the U.S. continue to recommend 1–3% portfolio allocations to Bitcoin, signaling growing mainstream acceptance. Regulatory clarity in the UK and U.S. has also been cited as a positive factor for long-term adoption.

However, the near-term outlook is clouded by expectations of tighter liquidity and potential regulatory shifts.
The Federal Reserve's monetary policy and the Bank of Japan's hawkish signals are seen as key variables that could influence the market. Analysts suggest that while regulatory developments provide a structural foundation for growth, the immediate risk-off environment is likely to persist unless a strong bullish catalyst emerges.