Bitcoin falls below $110,000, is the market turning bearish?

Original Title: "Bitcoin Falls Below $110,000, Whose Wallets Are Losing Money Again?"

Original Author: 1912212.eth, Foresight News

After the 10.11 black swan crash, the market was generally worried about a "second dip." Just a few days later, another plunge occurred. On October 17, bitcoin dropped for four consecutive days on the daily chart from its rebound high of $116,000, and around 4 p.m. today, it briefly fell to around $104,500, almost touching the 10.11 crash low of $102,000. ETH was not spared either, dropping to $3,706, and SOL fell to around $175, with most altcoins experiencing a general decline.

According to Coinglass data, in the past 24 hours, the total amount of liquidated open contracts across the network reached $1.189 billion, with long positions accounting for $935 million. The largest single liquidation occurred on Hyperliquid - ETH-USD, valued at $20.4274 million. Data from alternative shows that the current market fear index has dropped to 22, entering extreme fear territory.

Significant Net Outflows from US BTC and ETH Spot ETFs

Since the crash, US BTC spot ETF data has shown significant net outflows. From October 10 to October 16, only October 14 recorded a net inflow of $102.58 million, with all other days seeing net outflows. On October 1, the net outflow even exceeded $536 million, marking a new low since August this year.

The outlook for Ethereum spot ETFs is equally pessimistic, with large net outflows continuously occurring since October 9. On October 13, the net outflow exceeded $428 million, setting a new high for net outflows since September this year.

The Crash Has Weakened Market Confidence

DeFiance Capital, which once flourished in the last cycle by betting on multiple DeFi projects, suffered losses in this crash. On October 14, its founder Arthur posted on social media, "We're fine, the fund has suffered some losses, but it doesn't rank in our top five days of profit and loss volatility. I'm just very angry and disappointed. This crash has set the entire crypto space back significantly, especially for the altcoin market, since most price discovery happens on offshore CEXs."

He even pessimistically believes that this crash marks the end of the crypto era.

The previously hyped treasury DAT trend has also fizzled out. Tom Lee, chairman of BitMine, the largest Ethereum holding institution, stated that this bubble may have already burst.

Previously, US Nasdaq-listed company QMMM Holdings announced on September 9, 2025, that it planned to spend $100 million to establish a cryptocurrency reserve, and its stock price rose 9.6 times within three weeks. At the end of September, the US Securities and Exchange Commission (SEC) believed the company was suspected of manipulating its stock price via social platforms and ordered it to suspend trading from September 29. The company has remained suspended since then. On October 16, Caixin visited its Hong Kong headquarters and found the office deserted. When inquiring with an employee of another nearby company, they said QMMM had moved out in September, but they did not know where it had relocated.

Zhao Changpeng commented, "All crypto treasury (DAT) companies should use third-party crypto custodians and have their account setups audited by investors."

US Small Banks Blow Up, Market Sells First and Asks Questions Later

Zions Bancorp and Western Alliance Bancorp, two US regional banks, disclosed on Thursday that they suffered losses due to fraud involving bad commercial mortgage investment funds. Although the scale of losses was relatively small compared to other recent credit blowups—only involving tens of millions of dollars—the market reaction was unusually severe.

Germany's DAX index fell 2.13%, the UK's FTSE 100 index fell 1.6%, Japan's Nikkei 225 index fell 1.44%, Australia's S&P/ASX 200 index dropped 0.81%, and all three major US stock index futures declined.

Panic quickly spread, dragging down the entire banking sector, with the total market value of 74 large US banks erasing over $100 billion in a single day.

This "sell first, ask questions later" mentality spread rapidly. JPMorgan analysts Anthony Elian and Michael Pietrini noted in a report that they also questioned "why all these credit 'isolated incidents' seem to be happening in such a short period." However, the sell-off did not spare large bank stocks, with Citigroup and Bank of America both falling more than 3%.

The 2023 US banking crisis also once triggered a significant correction in the crypto market.

Will the Market Turn Bearish Next?

Chris Burniske, partner at Placeholder VC, posted, "I'm increasingly convinced that last Friday's crash has left the crypto market stagnant in the short term. After such a collapse, it's hard to quickly form sustained buying. This cycle has been disappointing for most people, which may limit action as everyone waits for a market rebound or previous historical highs. It's easy to get caught up in chart minutiae, but if you look at the monthly charts for BTC and ETH, it shows we're still in a high range (though cracks are showing), if you're considering taking profits."

"MSTR is falling, gold is flashing warnings, so is the credit market, and stocks will be the last to react. We can always expect a weak rebound, but I've already taken action (remember, cashing out is never all or nothing). I'll watch BTC's reaction to $100,000, but if BTC drops to $75,000 or lower, I might get interested in the market again. This bull run is different from previous ones, and the next bear market will be different too."

McKenna, partner at Arete Capital, said the market is in the process of forming a bottom, which will take 40-60 days to establish. All price action within this interval is just choppy consolidation. "By mid-November, we should start to expect constructive results and look forward to a positive December and Q1 2026."

glassnode tweeted that bitcoin is currently at a key support range, with the price below the 200-day moving average ($107,400) and just above the 365-day moving average ($99,900), while also facing resistance from the 111-day moving average ($114,700) above.

If it can hold the 365-day moving average, the trend may stabilize; if it breaks below this level, a deeper correction risk may arise.