Bitcoin News Today: Investors Hedge as Bitcoin's Distribution Drama Unfolds Below $110K

Bitcoin faces a critical price test as market participants brace for potential volatility amid three distinct price scenarios outlined by analysts. Recent price action suggests a struggle between bullish and bearish forces, with on-chain data indicating broad distribution among Bitcoin holders and a weakening in ETF inflows. The price dropped below $110,000 earlier this week, marking its lowest level in over six weeks, following a $11 billion offload from a long-dormant whale [1]. Despite the decline, futures demand for Bitcoin has surged to all-time highs, signaling sustained engagement from leveraged traders. Open interest in Bitcoin futures hit 762,700 BTC, a 13% increase from two weeks prior [1].

The bearish sentiment is further reflected in the options market, where put options have maintained a 10% premium over calls. This imbalance highlights the cautious outlook among investors, who are hedging against further downside [1]. The Bitcoin futures annualized premium remains at a neutral 8%, up slightly from the previous week, but still below the 10% threshold that would indicate broad bullishness [1]. Meanwhile, the perpetual futures funding rate has retreated to 11%, within the typical 8%-12% range for neutral markets, though the $1.2 billion in net outflows from US-listed Bitcoin ETFs has contributed to muted sentiment [1].

On-chain analysis shows that all Bitcoin wallet cohorts have shifted into distribution mode, with mid-size wallets (10–100 BTC) leading the sell-off. This synchronized behavior suggests widespread selling pressure and increases the likelihood of further price declines [3]. The 100–1,000 BTC group remains a critical variable, as their actions around the $105,000 level could determine whether Bitcoin stabilizes or continues its downward trajectory [3]. Analysts have also noted that Bitcoin’s seasonal tendencies align with the current pullback, with historical data showing an average decline of 21.7% during the “ghost month” period, which runs from August 23 to September 21 [3].

The technical picture for Bitcoin appears bearish, with a weekly engulfing candle reinforcing downside vulnerability. The 200-day simple moving average at $100,887 and the $110,756 level near the lower boundary of the Ichimoku cloud represent key support zones [4]. A breakdown below $105,000 could accelerate the price toward $92,000–$89,000, where historical cost bases for many long-term holders exist [3]. The recent weakness has also sparked renewed skepticism about the sustainability of the current rally, with some analysts suggesting that Bitcoin’s all-time high in BTC/EUR has not been seen since 2023, implying that recent gains may be more a result of a weaker dollar than fundamental strength [3].

In contrast, Ethereum has shown resilience, hitting a record high on Sunday despite the broader crypto market’s volatility. The asset’s performance highlights potential opportunities in altcoins, especially as traders rotate capital away from Bitcoin. However, Ethereum’s doji candle and bearish RSI divergence indicate a possible consolidation phase ahead [4]. If Bitcoin continues to underperform, it could trigger a broader reevaluation of risk across the crypto market, especially with ETF flows and macroeconomic factors playing a central role in price dynamics.

Source: [1] Bitcoin futures demand rises even as BTC sells off (https://cointelegraph.com/news/bitcoin-futures-demand-rises-even-as-btc-sells-off-what-gives) [2] Ethereum Price Hits Record High, Cryptos Reverse on Bitcoin Flash (https://www.investors.com/news/ethereum-price-record-high-bitcoin-cryptocurrency-fed-speech/) [3] Bitcoin holders 'distribute' as $105K becomes BTC's last stronghold (https://cointelegraph.com/news/bitcoin-holders-distribute-as-dollar105k-becomes-btc-s-last-stronghold) [4] Bitcoin Chalks Out Lower Price High After Powell, Ether Prints Doji at Lifetime Peak (https://www.coindesk.com/markets/2025/08/25/bitcoin-chalks-out-lower-price-high-after-powell-ether-prints-doji-at-lifetime-peak)