The market faces the most brutal 'deleveraging'

On-chain cost failure + ETF fund escape ⚠️ 81,700 becomes the life-and-death line, should we bottom out or wait and see?

As a veteran who has been in the crypto circle for 7 years, Sister Yasi has witnessed the darkness of the FTX collapse in 2022 and experienced the frenzy at the beginning of 2025, but the recent decline of Bitcoin still makes her sense danger - after breaking the short-term trading cost line of 90,900, the average point of 88,100 active investors has also declared failure, and it is currently approaching the real market average of 81,700, with the crypto market's 1 trillion market value evaporating in a month!

1. On-chain data warning: 70% of funds are trapped in losses

According to Checkonchain data, currently, 71.2% of Bitcoin's circulating supply cost is above $86,500, indicating that a large number of investors entering the market from late 2024 to early 2025 are deeply trapped. More critically, Glassnode's relative unrealized loss metric has surged to 8.5%, far exceeding the bullish market's healthy line of 5%, suggesting that this is not just an ordinary volatility correction, but a 'major reset' of the market's ownership foundation.

The Crypto Fear and Greed Index has fallen into the 'Extreme Fear' zone at 11, with panic selling on social media reaching a two-year high, and retail confidence dropping to its lowest point since December 2023. This sentiment resonates with on-chain data, intensifying the downward trend.

II. Breakout Chain Reaction: Liquidation Wave + Liquidity Exhaustion

The destructive power of this breakout is far beyond a simple price decline: over 220,000 traders were forcibly liquidated within 24 hours, with $2 billion in leveraged positions wiped out, 90% of which were long positions. More critically, Bitcoin ETF funds continue to flee, with net outflows approaching $3 billion in November, and BlackRock's IBIT set a record for the largest single-day net outflow in history, causing institutional withdrawal to completely collapse market support.

Liquidity exhaustion has exacerbated volatility—Bitcoin's order book depth has evaporated nearly 30% since early October, moderate sell orders can trigger a price crash, creating a death spiral of 'poor liquidity → high volatility → severe sell-off.' The decline of open interest in futures by 30% indicates that while market leverage is contracting, it remains highly concentrated, posing further liquidation risks.

III. Key for the Future Market: $81,700 is the Lifeline, $56,400 is the Ultimate Bottom Line

From a technical perspective, the real market average of $81,700 resonates with the previous low of $81,600 to form support; if breached, it will directly trigger a new round of stop-loss orders, potentially testing the $80,000 integer level or even the $70,000 production cost line.

In the long term, the realized market price of $56,400 is the ultimate bottom line; this price point served as support during the market crisis in 2022. If breached, it signifies that the crypto market will face a deep adjustment. However, I want to remind you that historical data shows that extreme panic often serves as a contrarian signal, and the current position may attract bottom-fishing funds, but be wary of 'buying the dip halfway up the mountain.'

IV. Deep Impact on the Crypto Market

The recent Bitcoin breakout has triggered systemic risk, with mainstream coins like Ethereum falling 8%-12% concurrently, and the correlation among cryptocurrencies soaring above 0.9, exposing market homogeneity risks. In the short term, the deleveraging process will continue, and altcoins, due to poorer liquidity, will experience much greater volatility than mainstream coins; the medium to long term will depend on Federal Reserve policies, ETF fund flows, and liquidity recovery.

Seven years of experience in the crypto space tells me that the market is never short of opportunities, but lacks a sense of reverence. In the current environment, controlling positions and staying away from high leverage is the way to survive. Follow me for continuous updates on the $81,700 support level's battle situation, real-time updates on on-chain data and institutional movements, helping you to avoid pitfalls in a volatile market.