Bitcoin News Today: Bitcoin Falls Below $116,000 Amid Fed Policy Uncertainty and ETF Outflows, $585M-$650M in Longs Liquidated

Bitcoin fell below $116,000 on July 25, 2025, driven by large wallet movements and heightened market caution ahead of the U.S. Federal Reserve’s policy meeting and the White House’s anticipated crypto policy report on July 30. The price decline, which saw Bitcoin drop to as low as $115,555, triggered significant liquidations, with estimates of $585 million to $650 million in long positions erased across exchanges [1][2]. The sell-off coincided with ETF outflows, including $131 million in single-day withdrawals from Bitcoin ETFs, reflecting short-term profit-taking and strategic rebalancing by institutional and retail investors [3].

The drop was attributed to unconfirmed reports of a potential $1.5 billion Bitcoin transaction, though Galaxy Digital has not verified any major exchange activities. Analysts noted that elevated leverage and regulatory uncertainty amplified market fragility, with volatility spanning both Bitcoin and altcoin sectors. Ethereum and other major tokens followed Bitcoin’s downward trajectory, contributing to a 6% decline in the broader crypto market capitalization [2].

Technical analysis highlighted Bitcoin’s consolidation in a tight range between $115,724 and $122,077, with the $116,000 level becoming a critical battleground. Maintaining this threshold is seen as essential to preserving the bullish structure observed in recent months. A sustained break below $116,000 could trigger further selling pressure from short-term holders (STHs), who currently hold Bitcoin at an average realized price of $103,900. Key support levels at $113,000 and $104,100 are critical for stabilizing the market, as a breach could exacerbate capitulation among recent buyers [4].

Market participants remain divided on the medium-term outlook. While some analysts maintain bullish forecasts, targeting $200,000 for Bitcoin, others caution that prolonged weakness below $116,000 could test the $114,300 level next, with a potential deeper correction below $112,000. Institutional activity and long-term holders are closely monitoring these thresholds, as their resilience will determine whether the pullback is a healthy consolidation or the start of a broader bearish phase [5].

The immediate catalysts for the decline reflect a mix of macroeconomic uncertainty and internal market dynamics. With the Fed’s rate decision and the White House’s crypto policy report looming, investors adopted a risk-averse stance. Wallet movements—particularly ETF outflows and STH liquidations—underscored short-term profit-taking and speculative unwinding. These factors, combined with Bitcoin’s proximity to critical technical levels, highlight the fragile balance between sustained bullish momentum and near-term volatility.

The market’s ability to stabilize above $116,000 will likely hinge on institutional buying activity and the outcome of the Fed’s policy meeting. A dovish stance could provide a floor for crypto prices, while hawkish signals or delays in regulatory clarity might prolong the correction. Traders are bracing for a pivotal week in July 2025, where Bitcoin’s performance could set the tone for the remainder of the year.

Sources:

[1] [Bitcoin Price Today Drops Below $116k Ahead of Fed Meet, Crypto Policy Report](https://www.investing.com/news/cryptocurrency-news/bitcoin-price-today-drops-below-116k-ahead-of-fed-meet-crypto-policy-report-4152447)

[2] [Bitcoin Drops Below $116,000 as Fed Meeting, Crypto Policy Loom](https://www.ainvest.com/news/bitcoin-news-today-bitcoin-drops-116-000-fed-meeting-crypto-policy-loom-2507/)

[3] [All Eyes on Fed Chair Powell](https://www.msn.com/en-in/news/other/bitcoin-slips-below-117000-amid-etf-outflows-all-eyes-on-fed-chair-powell/ar-AA1J2GKy)

[4] [Bitcoin STH Realized Price Chart Reveals Key Defense Zones Amid Volatility](https://cryptorank.io/news/feed/7211e-bitcoin-sth-realized-price-chart-reveals-key-defense-zones-amid-volatility)

[5] [Bitcoin (BTC) Price Prediction for July 24](https://coinedition.com/bitcoin-btc-price-prediction-for-july-24-2025/)