Bitcoin Price Drops 7% After Historic $100K Surge

Key Points:

• Bitcoin price drops to $92,144 before recovering to $97,325, reflecting market volatility.
• Demand for bearish options at $95K-$100K strike prices increases, signalling potential profit-taking.

According to Coinmarketcap, Bitcoin price drops 7% on Friday, tumbling to a low of $92,144, just a day after reaching $100,000 for the first time. Later, it steadied at $97,325, proving how wild the crypto action gets.

Bitcoin Experiences Sharp Dip After Historic Surge Above $100K

The volatility has spilt over into the broader crypto market, too, as traders head for cover in response to the recent jump and rebalance of their positions. Demand for bearish bets, especially put options that confer the right to sell at a predetermined price, has risen. According to Amberdata, the most significant activity has been for puts with strike prices around $95,000 and $100,000, while demand has also risen for lower strike prices, such as $75,000 and $70,000.

Market analysts suggest that such corrections are not uncommon in bullish cycles. “Although it feels like we’ve still got room to run, investors taking some profits off the table is expected,” said Josh Gilbert, market analyst at eToro. He added that past cycles have shown 20% to 40% Bitcoin price drops during bull runs.

Read more: CoinMarketCap Logo Changed to Celebrate Bitcoin’s $100,000

Trump’s Crypto Support Drives Market Optimism Despite Volatility

Bitcoin’s surge was first prompted by optimism over Trump’s pick of an advocate for digital assets to lead the top US securities regulator. The President-elect has vowed to ease rules on the crypto industry, which he says will make the US a global hotbed for digital assets. Trump’s support for a national Bitcoin price drop reserve has also helped drive investor excitement, even though some critics call the idea “crazy.

Despite the recent slump, long-term optimism is still there. On the Deribit exchange, options with the highest open interest for expiry in January are those with strike prices of $110,000 and $120,000, indicating that many traders are still bullish into 2025.