Bitcoin’s price dropped below $87,000 on Monday, marking the steepest decline in weeks amid a renewed wave of volatility triggered by December’s selloff. This wiped out last week’s gains, impacting the broader crypto market with over $400 million in liquidations and a 4% dip in global market value to $3 trillion.
Bitcoin fell to $86,125 in early Asian trading, signaling fragile recovery after November’s 18% loss.
Ether declined over 6% to below $2,900, while Solana dropped nearly 7%, mirroring the market’s downward trend.
Liquidations exceeded $400 million, highlighting risks from leveraged positions as investor sentiment weakens.
Discover why Bitcoin dropped below $87,000 in December 2025 amid volatility and weak ETF inflows. Explore impacts on major tokens and expert insights for crypto investors. Stay informed on market trends.
What Caused the Recent Bitcoin Price Drop Below $87,000?
Bitcoin’s price drop below $87,000 on Monday stemmed from a sharp selloff in early Asian trading, erasing last week’s advances and reflecting broader market fragility following November’s significant losses. This decline, the steepest in weeks, led to over $400 million in liquidations of leveraged crypto futures positions, pushing the global digital asset market value down by about 4% to around $3 trillion. Traders who anticipated a rebound were caught off guard, exacerbating the volatility as sentiment turned risk-averse at the start of December.
How Are Major Cryptocurrencies Affected by This Volatility?
The ripple effects of Bitcoin’s price drop extended to other major tokens, with Ether falling more than 6% to under $2,900, according to data from CoinMarketCap. Solana experienced a similar downturn, declining nearly 7%, as the market’s interconnected nature amplified the pressure. November proved punishing for the sector, with Bitcoin posting an 18% monthly loss—its worst since March—despite a brief rebound from near $80,000 to above $90,000 during the month. Ether suffered even more, dropping 22% for its steepest decline since February, underscoring the heightened sensitivity in the crypto space.
This fragility builds on earlier events, including the wipeout of roughly $19 billion in leveraged positions in early October, just after Bitcoin hit a record high of $126,251. While the leading cryptocurrency stabilized briefly above $90,000 last week, the latest wave of selling has positioned $80,000 as a critical support level. Expert analysis from Sean McNulty, APAC derivatives trading lead at FalconX, highlights the risk-off environment: “It’s a risk off start to December. The biggest concern is the meagre inflows into Bitcoin exchange traded funds and absence of dip buyers. We expect the structural headwinds to continue this month.” Such insights from industry professionals emphasize the need for caution amid ongoing uncertainties.
Investor confidence faced additional strain from comments by Strategy Inc. CEO Phong Le, who indicated on Friday that the firm might sell Bitcoin holdings if its modified net asset value (mNAV)—enterprise value relative to Bitcoin reserves—dips below 1. “We can sell Bitcoin and we would sell Bitcoin if we needed to to fund our dividend payments below 1x mNAV,” Le stated, describing it as a last resort. With Strategy holding a $56 billion Bitcoin stockpile and mNAV at 1.19 per its latest disclosures, this revelation adds to the bearish pressures, potentially signaling more supply in the market if conditions worsen.
Frequently Asked Questions
What triggered the $400 million in crypto liquidations this week?
The $400 million in liquidations arose from a sudden Bitcoin selloff in early Asian trading, catching leveraged traders off guard who had positioned for a price recovery. This event, tied to the broader December volatility, reduced the global crypto market cap by 4% to $3 trillion, as reported by market trackers like CoinMarketCap.
Is the crypto market recovery at risk after November’s losses?
Yes, the crypto market’s recovery remains vulnerable following November’s steep declines, with Bitcoin down 18% and Ether 22%. Weak ETF inflows and potential sales from major holders like Strategy Inc. could prolong the downturn, though key support at $80,000 for Bitcoin offers a potential floor for stabilization.
Key Takeaways
- Volatility Surge: Bitcoin’s drop below $87,000 highlights renewed market risks, with liquidations underscoring the dangers of leverage in uncertain times.
- Token Impacts: Ether and Solana followed suit with 6-7% declines, reflecting the sector’s interconnected fragility post-November losses.
- Investor Caution: Monitor ETF inflows and support levels like $80,000, as expert warnings suggest preparing for continued headwinds into December.
Conclusion
The recent Bitcoin price drop below $87,000 and its effects on major tokens like Ether and Solana illustrate the persistent volatility in the crypto market, compounded by weak inflows into Bitcoin exchange-traded funds and stability concerns surrounding assets like USDT. As S&P Global Ratings downgraded USDT’s assessment last week, citing risks of undercollateralization in a deeper downturn, Tether CEO Paolo Ardoino countered by defending the stablecoin’s overcapitalized reserves and resilience against traditional finance critiques. With upcoming U.S. economic data poised to shape interest rate expectations and potential Federal Reserve adjustments into 2026, alongside mixed Asian equity signals and hints of a Bank of Japan rate hike, investors should stay vigilant. This episode serves as a reminder of the market’s structural challenges, urging diversified strategies and close monitoring of key levels to navigate the path ahead effectively.
Building on these developments, the crypto landscape continues to evolve under macroeconomic influences. President Donald Trump’s announcement on Sunday regarding his decision for the next Federal Reserve chair, coupled with expectations for rate support, could provide some uplift if aligned with dovish policies. However, the absence of strong dip-buying and ongoing leveraged position risks maintain a cautious outlook. Data from platforms like CoinMarketCap consistently shows how such events can cascade, wiping out gains swiftly and testing long-term holder resolve.
In the broader context, the $19 billion liquidation event from early October lingers as a cautionary tale, demonstrating how record highs can quickly reverse without sustained inflows. FalconX’s analysis points to structural headwinds persisting, advising traders to watch for any rebound signals amid the December start. For those tracking Bitcoin’s price drop, understanding these dynamics is crucial for informed decision-making in a market valued at $3 trillion yet prone to sharp swings.
Overall, while the immediate pressure eases with stabilization efforts, the combination of corporate selling threats from firms like Strategy Inc. and regulatory scrutiny on stablecoins amplifies the need for preparedness. As the week unfolds with key economic indicators, the crypto community’s focus remains on resilience and adaptation to these volatile conditions.