Bitcoin’s upside remains capped by a dense wall of supply from underwater investors, leading to a tentative moment ahead of the holiday break, according to fresh analysis.

A lack of sustained spot demand and defensive derivatives positioning, meanwhile, shows a fragile market entering a low-liquidity Christmas period.

The top crypto began trading on Wednesday at around $86,300. It surged nearly 4.6% to breach $90,200, according to CoinGecko data, only to erase the entire bounce minutes later and snuff out hopes for a Santa relief rally.



The holidays typically bring a low-liquidity regime, which further amplifies volatility and market moves. Bitcoin remains flat on the day, trading near $86,600.

Wednesday’s spike in buying pressure stemmed from derivatives investors, as evidenced by an uptick in open interest and a positive delta in perpetual cumulative volume, according to Velo data.

In other words, recent buying is driven primarily by traders using leveraged derivatives, rather than by spot buyers. The subsequent drop on the same day, however, was mainly driven by spot sellers, as evidenced by the decline in the spot cumulative volume delta.

Wednesday’s rejection and the resulting drop reflect “the dense supply accumulated between $93,000 and $120,000,” according to a report by Glassnode on Wednesday.

The report notes that any upside development is likely to “remain constrained” as long as the price remains below the 0.75 quantile, at roughly $95,000, and fails to reclaim the short-term holder breakeven level of $101,500.

The true market mean at $81,500, which is the average acquisition cost of Bitcoin held by active investors, has absorbed the selling pressure so far, preventing a deeper breakdown. But the question on everyone’s minds is, for how long?

“It's unlikely we'll see a significant 'rocket jump' for Bitcoin before the end of 2025, given the current bearish sentiment,” Ryan Yoon, senior analyst at Seoul-based Tiger Research, told Decrypt. “However, if the upcoming CPI data is favorable, we could see a short-term relief rally as the market reacts to potential easing of inflationary pressures.”

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