Bitcoin down to $88,000 from $93K all-time high

Bitcoin’s back on the wild side. After hitting an all-time high of $93,000, the world’s most popular cryptocurrency is down to $88,000. This sharp drop comes just as quickly as Bitcoin’s surge after the U.S. presidential election results.

For those following the rollercoaster that is Bitcoin, it’s been up by 35% over the past month, but now it’s bouncing between $88,000 and $89,000, according to CoinMarketCap data.

So, what’s behind this fresh dip? It’s not just price charts and market sentiment; we’re looking at the Bitcoin futures market going hot. And by hot, I mean boiling. The BTC/USDT pair has seen insane volumes across both spot and futures markets on centralized exchanges.

Binance alone is clocking record-breaking numbers, holding a massive share of the action. In the past few days, futures trading volume on BTC/USDT across major exchanges hit a mind-blowing $129 billion. Out of that, Binance took the lion’s share at $50.2 billion.

Bitcoin futures: When the market’s too hot

Right now, Bitcoin’s futures market is cranked up. When you see the derivatives market—especially futures—spike alongside big price jumps, there’s a recipe for volatility. And yeah, that means sudden price moves, quick dips, sharp rebounds, and the whole dizzying mix. With this overheated market, seasoned investors are urging caution.

Now, let’s talk about why Bitcoin soared past $90,000 in the first place. The U.S. election win of the crypto-friendly president Donald Trump. Why? On the campaign trail, Trump made many promises about making America “crypto capital of the planet.”

And that wasn’t all. He pledged to position Bitcoin as a “superpower” in the financial world. With Trump set to take office, investors have been all over Bitcoin, driving the price up in anticipation of pro-crypto policies, especially after over 80% of pro-crypto candidates won the House and Senate.

Market’s reaction

For those who bet on Bitcoin’s future under Trump, it’s been a good month. Right before the election, Geoff Kendrick from Standard Chartered predicted a massive rally in case of a Trump win. Sure enough, election night sent Bitcoin up 30% almost immediately.

Federico Brokate, the vice president of 21shares, had his sights set on $100,000. “The next price target we’re looking at is the $100,000 mark,” he said. “We think we could reasonably reach that by, quite frankly, Inauguration Day.”

But investors are also piling into Bitcoin because of macroeconomic factors like falling interest rates, which make riskier assets like crypto more appealing. Brokate believes that a Republican-led administration might give crypto a regulatory edge, but, at the end of the day, he says crypto’s trajectory is apolitical.

“A Kamala presidency would have meant the same exact things for crypto and digital assets in four years’ time as a Trump presidency,” Brokate said . “This asset class is completely apolitical at the end of the day.

Spot ETFs and the retail FOMO

Let’s not ignore the massive cash flowing into Bitcoin spot ETFs. For retail investors, these ETFs have become an easy entry point. In less than a year, spot Bitcoin ETFs have raked in about $50 billion.

Andy Baehr, managing director of Coindesk Indices, points out that crypto investors generally fall into three groups: professionals, avid traders, and “five percenters” (retail investors who only want to put a small slice of their money into crypto).

While “five percenters” have gained easier access to the crypto market over the years, Baehr notes there’s still room for growth. “There’s still a lot of five percenter money that hasn’t found its way to a Bitcoin ETF yet, much less anything else,” Baehr said.

“There’s tremendous adoption scope available.” The enthusiasm from retail investors is on a steady climb, especially as they seek more accessible ways to get into crypto without having to mess with wallets and direct exchanges. With ETFs managing billions in investor cash, the retail side of crypto investing is just getting started.