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Bitcoin's Crossroads: Short-Term Pain, Long-Term Gain?

Wednesday Dec 3 2025 09:50

2 min

Table of Contents

1. Bitcoin at a Crossroads: Is Accumulation Time Nearing?
1.1 Optimistic 2026 Outlook Despite Current Correction
1.2 Bitcoin ETF Impact on Selling Pressure Examined
1.3 Bitcoin ETFs Show Signs of Recovery

Bitcoin at a Crossroads: Is Accumulation Time Nearing?

Bitcoin may be nearing a critical juncture as short-term traders grapple with the most substantial unrealized losses of this bull cycle. CryptoQuant analyst Darkfrost notes that Bitcoin (BTC) holders for one to three months have endured losses between 20% and 25% for over two weeks, marking the current market cycle's most painful stretch. "Once a large portion of them has capitulated, as we have seen in recent weeks, that is usually when the opportunity to accumulate becomes interesting," he stated on Monday. He further added that this cohort will remain underwater until BTC climbs above its realized price of approximately $113,692.

Optimistic 2026 Outlook Despite Current Correction

Despite the ongoing correction, some of the largest financial institutions maintain a positive outlook for Bitcoin's performance in 2026. Asset management giant Grayscale indicated on Monday that Bitcoin's present drawdown suggests a local bottom is forming ahead of a recovery in 2026 – a scenario that could challenge the conventional four-year cycle theory, according to the firm.

Bitcoin ETF Impact on Selling Pressure Examined

Contrary to earlier concerns regarding large-scale sales from spot Bitcoin exchange-traded fund (ETF) investors, these funds accounted for only a small fraction of the selling pressure driving Bitcoin's price decline. Bloomberg ETF analyst Eric Balchunas commented on Monday, "I just read that Citi analysts say that for every $1 billion pulled from Bitcoin ETFs it equals roughly a 3.4% drop in Bitcoin's price. Ok, so then by that logic, since the ETFs have taken in +$22.5b of inflows YTD BTC should be up 77% this year. ETFs have been like 3% of the total selling tops."

Bitcoin ETFs Show Signs of Recovery

Bitcoin ETFs have begun to rebound from the cumulative outflows of $3.48 billion experienced in November, which was their second-worst month on record. On Tuesday, Bitcoin ETFs reported net positive inflows of $58 million, marking their fifth consecutive day of positive inflows, according to data from Farside Investors. These modest inflows could persist as Bitcoin trades above the flow-weighted cost basis for ETF buyers, which is roughly $89,600, suggesting that the average holder is no longer experiencing paper losses. Regarding other US crypto funds, spot Ether (ETH) ETFs witnessed outflows of $9.9 million on Tuesday, while Solana (SOL) ETFs recorded net negative outflows of $13.5 million, as per Farside Investors.

Risk Warning: this article represents only the author’s views and is for reference only. It does not constitute investment advice or financial guidance, nor does it represent the stance of the Markets.com platform.When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice. Trading cryptocurrency CFDs and spread bets is restricted for all UK retail clients. 

Written by:

Emma Rose

Bitcoin's Crossroads: Short-Term Pain, Long-Term Gain?

Bitcoin at a Crossroads: Is Accumulation Time Nearing?

Optimistic 2026 Outlook Despite Current Correction

Bitcoin ETF Impact on Selling Pressure Examined

Bitcoin ETFs Show Signs of Recovery

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