Bitcoin’s price movement has been relatively narrow in recent weeks, with bulls and bears struggling for control. This uncertainty has kept the leading cryptocurrency fluctuating between $89,000 and $93,000. Recent on-chain data suggests this sideways trend is linked to an uneven distribution of Bitcoin’s total supply across different price levels. The same analysis also points to a potential next target for Bitcoin’s price.
Is BTC Price Facing a 20% Drop?
In a December 13 post on X, analyst Darkfost noted that Bitcoin’s price is caught between $89,000 and $93,000. This observation is based on the distribution of BTC supply around various prices, using the URPD (UTXO Realized Price Distribution) metric.
The URPD metric shows how much of a cryptocurrency was last traded at a specific price. When a large volume of coins changes hands at a certain level, that area often acts as support if the price is above it, or resistance if the price is below it.
Darkfost explains that this is why Bitcoin appears stuck in the $89,000 to $93,000 range (shown in yellow on the chart). Significant trading activity in this zone has kept BTC oscillating within these bounds.
A new development is the “distribution gap” (highlighted in blue) between $74,000 and $80,000. This area has seen relatively low historical trading activity. Darkfost points out that such low-liquidity zones tend to attract prices as the market seeks to rebalance supply and demand.
As the chart shows, this gap lies between $74,000 and $80,000, suggesting BTC could correct to this level before potentially rebounding to new highs. A drop to this range would represent a decline of nearly 20% from current prices.
Additionally, Darkfost observed that 34% of Bitcoin’s total supply distribution now sits above the key $90,000 level. Over time, this could help establish $90,000 as a structural support zone.
It’s also important to note that while a large cluster appears around $84,000, it shouldn’t be overemphasized. Darkfost mentioned this distribution is not entirely organic, but partly a result of recent Bitcoin movements by Coinbase.
Bitcoin Price Snapshot
As of now, Bitcoin is trading around $90,150, showing little change over the past 24 hours.
Frequently Asked Questions
FAQs Bitcoins Potential Price Dip Below 80000
Beginner Questions
Q What does it mean when people say Bitcoins price might dip
A A dip means a temporary drop in price Its a normal part of market cycles where the price falls from a recent high before potentially recovering
Q Why is 80000 a significant price level for Bitcoin
A 80000 is a key psychological and technical threshold If Bitcoin falls below it many analysts believe it could trigger more selling as traders watch for support levels to break
Q Is a price dip below 80000 a bad thing
A Not necessarily For longterm investors dips can be buying opportunities Volatility is common in crypto and prices rarely move in a straight line
Q What are the most common reasons Bitcoins price drops
A Common reasons include large investors selling negative news broader stock market declines or periods of low trading activity and uncertainty
Market Advanced Driver Questions
Q What specific factors could drive Bitcoin below 80000
A Key drivers could be
Macroeconomic Shifts A sudden rise in interest rates or a strong US dollar
Major Sell Pressure Large transfers from miner or whale wallets to exchanges signaling intent to sell
Regulatory News Unexpected harsh regulations from a major economy like the US or EU
Market Sentiment Shift A sharp decline in a major stock index often pulls crypto down with it
Liquidation Cascades If the price falls enough to trigger a wave of automatic selloffs in leveraged futures trading
Q How does Fear and Greed in the market affect the price
A When the market is extremely greedy at high prices its often overbought and due for a correction A shift to fear can cause rapid selling as people try to lock in profits or avoid losses
Q What role do Bitcoin miners play in a potential price drop
A If Bitcoins price falls while mining costs remain high miners may be forced to sell more of their