‘Fire sale valuations’ on offer as Bitcoin price tumbles to $82,000, says Bitwise

Is Bitcoin having a fire sale?

The top cryptocurrency’s price plunged to around $82,000 on Friday, extending a month-long sell off that has erased more than $1.4 trillion from cryptocurrency markets.

But for Bitwise’s European head of research, André Dragosch, the crash presents investors with a potentially lucrative opportunity.

“Bitcoin could still trade lower in the short term until a clear bullish catalyst emerges,” Dragosch told DL News. “But these would be ‘firesale valuations’ and very attractive entry points to build exposure to Bitcoin.”

How low can it go? Well, Dragosch is eyeing up support between $81,000 and $73,000 — the cost basis for BlackRock’s IBIT and Strategy’s holdings, along with Bitcoin’s former all-time high. Below that, he argues, Bitcoin becomes a screaming buy.

Blood streams down the street as Bitcoin trades more than 30% below its October all-time high, dragged down by an unpleasant mix of Fed uncertainty, AI bubble fears, and crypto-specific pessimism.

Investors pulled $548 million from Bitcoin exchange-traded funds on Thursday, bringing November’s outflows to a whopping $3.7 billion.

Lingering weakness

Three forces are crushing Bitcoin.

First, there’s uncertainty around what the Federal Reserve will do in its upcoming December meeting, especially after the historically long government shutdown delayed critical economic data.

Uncertainty or not, however, investors are pricing in a rate cut. The CME FedWatch tool now assigns 70% odds to a December rate cut, up from just 35% a couple of days ago.

Second, fears are bubbling in the AI trade. Nvidia surged 5% early Thursday on blockbuster earnings, then finished down 3.1% as valuation concerns resurfaced.

“These moves reverberated across crypto which tends to move in tandem with tech stocks,” Carlos Guzman, research analyst at GSR, told DL News.

Finally, there’s a crypto-specific weakness. “There’s been lingering weakness and pessimism in crypto, along with diminished market liquidity, following the October 10 crash,” Guzman said.

That October 10 crash wiped out a staggering $19 billion from the crypto markets.

Bull market correction

Despite the decimation, Dragosch argues the correction remains “in line with previous interim bull market corrections both in terms of depth and duration.”

Sentiment indicators signal extreme “pain” among short-term holders — typically unsophisticated investors whose capitulation often marks bottoms.

“A reversal could happen anytime,” Dragosch said.

Still, he’s waiting for a clear catalyst. That could mean Fed continues quantitative easing — also known as money printing — or bond market jitters that force an intervention.

“We still expect the Bitcoin bull cycle to extend well into 2026 due to monetary

easing across the globe which tends to affect global growth conditions and risk appetite with a significant lag,” Dragosch said.

Pedro Solimano isDL News’ Buenos Aires-based markets correspondent. Got a tip? Email him [e-mail].