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Bitcoin’s recent price movements have sparked debate among experts, with some warning of a potential sharp decline while others highlight strong support levels and innovative borrowing trends.
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Market dynamics suggest that large holders may increasingly leverage their Bitcoin holdings instead of selling, potentially limiting downward pressure on prices.
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According to Bitwise CEO Hunter Horsley, borrowing against BTC could become the preferred liquidity strategy, a view supported by JPMorgan Chase’s recent adoption of crypto ETFs as collateral.
Bitcoin faces mixed signals as borrowing trends rise and sell-offs moderate; key support at $97.6K and resistance near $115.4K shape short-term outlook.
Bitcoin’s Short-Term Outlook: Balancing Sell-Offs and Borrowing Trends
Bitcoin (BTC) has experienced notable volatility recently, with prices briefly testing the $110,000 mark before settling around $109,500. Despite this, on-chain data from Glassnode reveals that selling pressure from long-term holders (LTH) has increased to approximately $930 million per day. However, this figure remains modest compared to previous peaks, such as the $1.64 billion daily sell-off during the initial breakout above $100,000.
This restrained selling activity suggests that the market is not currently undergoing a broad distribution phase, which typically precedes significant price declines. Glassnode’s analysis highlights two critical price levels: a near-term resistance at $115,400 and a pivotal support at $97,600, based on the short-term holder (STH) cost basis model. Maintaining support above $97,600 is essential to sustain bullish momentum, while surpassing $115,400 could signal the start of a new price discovery phase.
Borrowing Against Bitcoin: A New Liquidity Paradigm
As Bitcoin approaches higher price thresholds, industry leaders predict a shift in how holders access liquidity. Hunter Horsley, CEO of Bitwise, emphasizes that once Bitcoin surpasses the $130,000 to $150,000 range, holders are more likely to borrow against their assets rather than sell them. This trend is already gaining traction, with major financial institutions like JPMorgan Chase accepting crypto ETFs as collateral, thereby expanding lending options.
This evolving borrowing ecosystem could reduce the supply of Bitcoin on the market, potentially driving prices higher due to scarcity. Horsley notes, “There’s simply not going to be enough Bitcoin” to meet demand if this trend continues, underscoring the potential for sustained upward price pressure.
Contrasting Views: Peter Brandt’s Bearish Projection
Despite optimistic borrowing trends, some analysts remain cautious. Veteran trader Peter Brandt has warned that Bitcoin’s current price action resembles a double top pattern similar to the one observed in 2021. He projects a possible 75% correction, which would see Bitcoin’s price fall from around $109,000 to approximately $27,000.
However, this bearish outlook faces skepticism due to historical support levels. Past bear markets have seen Bitcoin’s price stabilize near the 200-week moving average, which currently hovers around $48,000. This level has historically acted as a strong floor, mitigating the severity of price crashes.
Source: Glassnode
Source: Glassnode
Source: Peter Brandt/X
Conclusion
Bitcoin’s near-term trajectory remains influenced by a balance of cautious selling from long-term holders and innovative liquidity strategies such as borrowing against BTC. While bearish scenarios like Peter Brandt’s double top projection warrant attention, historical support levels and evolving market behaviors suggest that a severe downturn may be unlikely. Investors should monitor key price points around $97,600 and $115,400, as these will be critical in determining whether Bitcoin continues its bullish momentum or faces increased volatility. Staying informed and considering multiple perspectives will be essential for navigating the dynamic crypto landscape.
