Bitcoin News Today: Bitcoin's Price Plunge: A Battle Between Shorts and Institutional Bulls

Bitcoin's price continued to face downward pressure in early August 2025 after hitting a record high of $124,474 the previous week, with the cryptocurrency dropping to $115,255.70 as of the latest data. The decline followed over $500 million in forced liquidations of long positions, triggered by heightened macroeconomic concerns and a surprise rise in July wholesale inflation data, which cast doubts on the likelihood of a Federal Reserve rate cut in September [1]. The price correction marked a 6.72% pullback below $115,000, raising speculation about further declines toward $110,000 and beyond [2].

Profit-taking and the accumulation of short positions at new highs have become a recurring theme for Bitcoin traders, particularly when the asset reaches all-time highs. According to data from CoinGlass, 133,643 traders sold $576.35 million worth of positions in the past 24 hours, including $124 million in long Bitcoin liquidations. These forced sales often push prices lower, especially in thinner markets like the weekend, when liquidity tends to dry up [2]. Hyblock’s CEO Shubh Varma noted visible liquidity sweeps in Bitcoin’s price action, particularly in the order book and on-chain metrics, which contributed to the sharp decline below $115,000. However, Varma also observed that open interest was concentrated at these levels, indicating strong potential for a bounce due to trapped shorts and overlapping long positions [2].

Analysts from Santiment highlighted that Bitcoin's current overvaluation metric, the Market Value to Realized Value (MVRV) ratio, stands at +21%, signaling a “mild danger zone” for profit-taking. While not at extreme levels, this indicator suggests that the average investor has seen substantial gains, increasing the likelihood of selling pressure. Bitcoin’s price stood at $115,800 at the time of the report, about 6% below its recent all-time high [3]. Bitfinex analysts echoed this sentiment, noting that the market was consolidating after a brief 10% rally and that investors were in a “wait-and-watch” stance ahead of key macroeconomic catalysts, including the Federal Reserve’s rate decision in late September [3].

Despite the near-term uncertainty, institutional demand for Bitcoin remained robust, with several treasury firms and companies continuing to accumulate the asset at current price dips. For example, Metaplanet and Strategy added 1,185 BTC on Monday alone, taking advantage of favorable buying opportunities [4]. Additionally, the U.S. government’s recent establishment of a Strategic Bitcoin Reserve, announced by President Donald Trump, signaled growing recognition of Bitcoin’s role as a long-term asset. This development, coupled with the increasing adoption of Bitcoin by public companies, suggests a broader institutionalization of the asset class [5].

Looking ahead, the price action will largely depend on macroeconomic clarity and the pace of institutional adoption. While the market remains in a consolidation phase, the upcoming Jackson Hole symposium and jobless claims data will be closely monitored for hints of Fed policy direction. Some analysts predict that Bitcoin could find support around $115,000, particularly if open interest and liquidity dynamics align to prevent further downside. On the other hand, continued outflows from institutional investors, as seen on Monday with a $121.81 million net outflow, could pressure the price further in the short term [4].

Long-term perspectives remain bullish for Bitcoin, with some analysts projecting a price of $500,000 per coin by 2030. This forecast is based on Bitcoin’s capped supply, growing institutional interest, and its role as a digital store of value. The approval of spot Bitcoin ETFs, combined with corporate and government purchases, is seen as a catalyst for continued appreciation. Additionally, the next Bitcoin halving event, expected around April 2028, is likely to reduce the supply of new coins entering the market, historically contributing to price increases [5].

Source:

[1] Crypto Market Today (https://www.cnbc.com/2025/08/18/crypto-market-today.html)

[2] Bitcoin Liquidity Zones Swept (https://cointelegraph.com/news/bitcoin-liquidity-zones-swept-but-uptick-in-open-interest-hints-at-btc-recovery)

[3] Bitcoin Price Danger Zone (https://cointelegraph.com/news/bitcoin-price-danger-zone-consolidation-profit-takers-analysts)

[4] Bitcoin Price Forecast (https://www.mitrade.com/insights/news/live-news/article-3-1050761-20250819)

[5] Prediction: Bitcoin Will Be Worth $500,000 in 5 Years (https://www.nasdaq.com/articles/prediction-bitcoin-will-be-worth-500000-5-years)