Bitcoin is heading towards the second worst fourth quarter in history, down 22.8% in Q4/2025 and currently mainly moving sideways around the 85,000 USD region.
Thin liquidity during Christmas and a large options expiration on December 26 could cause volatility to spike. However, signals from the options market and on-chain data present two conflicting scenarios: a short-term bounce after the holiday or medium-term weakness due to contracting demand.
MAIN CONTENT
Bitcoin’s Q4/2025 is down 22.8%, approaching the second worst fourth quarter in history.
The options expiration on December 26 could break the 85,000–90,000 USD range and create strong volatility.
CryptoQuant warns that Bitcoin demand has weakened since the beginning of October, increasing bear market risk in the medium term.
Bitcoin may rise after Christmas if the options 'pin' is lifted.
Bitcoin has the potential for strong volatility after December 26 when options expire, as the options positions are 'pinning' prices around 85,000–90,000 USD. If the pinning force decreases, prices could break out of bounds and sweep liquidity up to 90,000–95,000 USD or down near 84,000 USD.
According to crypto exchange QCP, thin liquidity during the Christmas holiday combined with a large options expiration on December 26 could trigger volatility. QCP believes that the 'downside' positioning has eased as the open interest of the put 85,000 USD has decreased, while the call 100,000 USD still exists, reflecting cautious optimism about the 'Santa rally'.
“Downside positioning has eased as the open interest of the put 85,000 USD has drifted lower, while the call 100,000 USD still exists, indicating cautious optimism about a 'Santa rally'.”
– QCP, quoted from an update on X
QCP also emphasized that bearish sentiment has cooled, but the market may still move sideways until December 31. This implies that volatility may be compressed in the short term, then spike sharply when the 'positioning' and liquidity factors change around the expiration date.
Options analyst David also expects a breakout rally after Christmas, following a ‘chop’ phase (jerky, sideways). The common interpretation is that when the hedging orders around the main strike decrease after expiration, prices will have more room to move quickly in the direction of liquidity imbalance.
“Expectations will struggle until Christmas, after which there may be an explosion when the ‘safety lock’ is opened.”
– David, options analyst, quoted from X
David stated that big players are 'pinning' the price in the range of 85,000–90,000 USD through put wall (bearish bets) and call wall (bullish bets), corresponding to approximately 300 million USD gamma exposure. In this context, after the expiration on Boxing Day (26/12), Bitcoin may break the accumulation zone if the pinning power weakens.
The liquidation heatmap data also describes liquidity clusters: the upper side concentrates around 90,000 USD and 95,000 USD (often associated with short positions that are easily liquidated when prices rise), while the lower side is notably around 84,000 USD. This implies prices may 'sweep' these levels if volatility spikes, especially in periods of thin liquidity.
Weak Bitcoin demand increases the risk of deep declines in the medium term.
According to CryptoQuant, Bitcoin demand growth has slowed since the beginning of October and is currently below trend, indicating that most of the cycle's demand strength may have passed. If demand continues to decrease, the likelihood of a capitulation phase will increase.
CryptoQuant warns that BTC demand has contracted and could lead to a deeper capitulation phase in the bear market. In the report, the organization notes that demand growth has entered a slowdown phase since the beginning of October and is currently rising below trend, hence the negative impact on prices may continue as support from demand weakens.
“Demand growth has entered a slowdown phase since the beginning of October and is currently rising below trend. Therefore, we believe that most of the demand growth of this cycle has passed, leading to corresponding downward price effects.”
– CryptoQuant, cited from a research report
CryptoQuant also pointed out the technical levels based on history: the near support zone is 70,000 USD and the 'bear market bottom' scenario could be at 56,000 USD. These levels are not certain forecasts but are references from historical data, used to frame risk if the demand weakness translates into a more sustained downtrend.
The year-end outlook for Bitcoin depends on the expiration of options and real demand strength.
In the short term, Bitcoin may escape the 85,000–90,000 USD range after December 26 due to volatility from options. In the medium term, signals of weakened demand pose a greater risk, as it could exert prolonged downward pressure even if there is a short-term technical bounce.
Overall, the market has two layers of signals. Layer 1 is the 'market mechanism' around options: put/call walls and gamma may create volatility compression, then spike sharply at expiration. Layer 2 is the 'cycle foundation' from on-chain: if demand continues to be below trend, upward movements may be limited and the risk of returning to a bear market will increase.
Frequently asked questions
Why could December 26 lead to strong volatility for Bitcoin?
Since this is a time of large options expiration, while holiday liquidity is often thin. As contracts expire, the hedging orders and 'pinning' positions around major strikes can change quickly, causing prices to break out of bounds and sweep liquidity.
What price levels are currently the focus according to options analysis?
The analyses mention that prices have been pinned in the range of 85,000–90,000 USD, with the put 85,000 USD and call 100,000 USD being notable. The liquidity clusters above are mentioned around 90,000 USD and 95,000 USD, while below is around 84,000 USD.
What is CryptoQuant warning about Bitcoin demand?
CryptoQuant believes that demand growth has slowed down since the beginning of October and is currently below trend. They assess that most of the demand growth of the cycle may have passed, leading to downward price pressure and increased capitulation risk in the medium term.
What potential support/bottom levels are mentioned?
CryptoQuant states immediate support around 70,000 USD and the bear market bottom scenario could be at 56,000 USD, based on historical data references. These are risk framework levels, not commitments about reversal points.
Source: https://tintucbitcoin.com/bitcoin-hut-da-noel-santa-rally-huy/
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