From 126,000 to 86,000, Bitcoin may experience its fourth annual decline in history, with 70,000 becoming a key support level.

Bitcoin is facing its fourth annual decline in history, the first without a major scandal or industry collapse accompanying it. The latest round of decline occurred on Monday, with a sharp sell-off during the New York trading session causing the original cryptocurrency to drop by 3.7%. Bitcoin has fallen by about 7% since the beginning of the year. At the time of writing, its price is around $86,700. Although this decline is much smaller compared to the three previous annual declines, the context is vastly different. Since the previous crypto market crash in 2022, institutional participation has been expanding, and regulatory systems are becoming more mature. Furthermore, the industry has welcomed perhaps its most important supporter - U.S. President Donald Trump. Since Bitcoin reached a record high of over $126,000 in early October, its price has plummeted steeply, catching the bullish camp off guard and leading the crypto asset market to struggle to stabilize, plunging into turmoil. During this period, market trading volume has remained low, investor confidence has been shaken, and many have chosen to withdraw from the Bitcoin ETF market. Meanwhile, the derivatives market has shown a cautious stance, lacking the willingness to bet on a price rebound. Even Strategy Inc. (MSTR.US), led by the top whale in the Bitcoin field, Michael Saylor, has not been able to successfully turn the unfavorable market situation around. Why isn't Bitcoin rising despite positive factors? Before reaching its peak in October, Bitcoin's rise seemed unstoppable. At that time, Trump had declared the crypto sector a national priority for development; the U.S. Congress had successfully passed landmark stablecoin-related legislation; and Bitcoin exchange-traded funds (ETFs) were attracting billions of dollars in funds. Additionally, mergers and financing in the industry were rapidly increasing, and even several enforcement cases launched by the Biden administration against crypto companies were withdrawn. However, beneath the seemingly prosperous surface, the market's hidden vulnerabilities have been quietly accumulating, with the issue of extreme leverage being particularly prominent. On October 10th, this vulnerability finally exploded publicly, as leveraged bets amounting to $190 billion faced forced liquidation, plunging the entire crypto market into chaos. Bitcoin whales began selling off, and despite the majority of leverage being cleared, the price remained under pressure. According to CoinDesk data, trading volume plummeted, showing the largest monthly decline since early 2024. Multiple market indicators show that traders are currently adopting a wait-and-see approach. Since October 10th, investors have withdrawn over $5.2 billion from the U.S.-listed spot Bitcoin ETF. Data from research firm Kaiko shows that market depth (measuring the market's ability to absorb large transactions without major fluctuations) has dropped by about 30% from its peak of the year. "Serious selling by old whales has severely diminished momentum," said Pratik Kala, portfolio manager at hedge fund Apollo Crypto. "The industry has gotten everything it wanted on the regulatory front - even ETFs with collateral functions - yet the price has not kept up." Kala admitted, "Although the current market is filled with positive factors that could help drive prices up, the price is going in the opposite direction, bearish instead, which has caught most people off guard regarding the continuation of the upward trend." In the bear market scenario, Bitcoin is showing signs of disconnecting from the stock market. Earlier this month, the S&P 500 index closed at a historic high, with a year-to-date cumulative increase of 16%. Tech stocks, usually closely correlated with Bitcoin, have performed even better during this period. Bitcoin's previous three crashes all had black swans, but this time, only "time correction" remains. Since Bitcoin officially began trading on exchanges in 2010, the previous three years of price declines were accompanied by events that severely impacted market confidence in the short term. In 2014, it was a "dark moment" in the development of Bitcoin. At that time, the well-known Bitcoin exchange Mt. Gox was unfortunately hacked and subsequently collapsed. This event, like a heavy hammer, exposed significant flaws in the early infrastructure of the crypto industry and made early traders realize that storing funds on centralized platforms was not absolutely secure. As a result, the price of Bitcoin plummeted significantly that year, with a drop of up to 58%. Four years later in 2018, the crypto market once again fell into turmoil. Under pressure from regulatory agencies, the once-popular Initial Coin Offering (ICO) bubble burst, causing sharp drops in the prices of Bitcoin and various other tokens. That year, Bitcoin fell by 74%, still the largest annual decline in its development history. The crash in 2022 may have a more significant impact on the development of the crypto market. Part of the reason is that the crypto market has greatly expanded compared to before. This crash not only led to the collapse of many industry giants, including Sam Bankman-Fried's FTX, but also triggered massive regulatory crackdowns by the Biden administration. "Ultimately, this cycle is likely more of a time adjustment than a drastic price adjustment," said Maxim Saylor, CEO of digital asset trading company STS Digital. "We may be facing a long-term consolidation period, with Bitcoin fluctuating between $70,000 and $100,000." ------------------------------------------------------------------------------- Please note that the translation may not be perfect, but I hope it helps!