Bitcoin could tumble to $10K, putting ETH, ADA, and XRP at risk, according to expert

Traders are increasingly bracing for downside risks in crypto markets, as a surge in put options signals expectations that bitcoin could drop below $85,000.

Bitcoin hovered near $87,000, with recent rallies losing momentum and short-lived gains quickly giving way to renewed selling, according to CoinDesk. The cryptocurrency briefly climbed to $90,000 late Wednesday before slipping back under $87,000, underperforming equities amid ongoing macro uncertainty. Traders are focused on the Dec. 26 options expiry, where data show heavy accumulation of puts at the $85,000 strike. Thirty-day implied volatility has climbed toward 45%, while both short- and long-dated skew remain negative, reflecting strong demand for downside protection, according to Derive.xyz.

“There’s clear defensive positioning going into year-end,” said Alex Kuptsikevich, chief market analyst at FxPro. “The uptrend from late November has been broken, and the market is behaving similarly to the October sell-off, with sharp rebounds failing to hold.”

Ether shows a slightly more balanced profile. While short-dated ETH skew remains negative, longer-dated skew is closer to neutral, indicating less conviction around a sustained downturn. Traders have accumulated a notable cluster of puts around $2,500 for the Dec. 26 expiry, marking a key area of concern.

Some analysts warn that bitcoin’s long-term cycle may be turning. Bloomberg Intelligence commodities strategist Mike McGlone suggested that the rally above $100,000 earlier this year could be setting the stage for a deeper retracement.

“Bitcoin’s surge toward six figures may have triggered a cycle back toward $10,000, potentially in 2026,” McGlone said, noting that periods of extreme wealth creation are often followed by sharp reversals. He also highlighted that highly speculative digital assets with effectively unlimited supply could be most vulnerable in the next economic downturn.

Despite warnings, bitcoin has remained relatively resilient, down roughly 5% in 2025 through mid-December. CryptoQuant data shows short-term holders have been sitting on losses for over a month, while Glassnode estimates that long-term holders have sold around 500,000 BTC since July.

Kuptsikevich added that Federal Reserve rate cuts this year acted more as a signal that monetary tightening was over than as a direct catalyst, allowing investors to maintain risk exposure through drawdowns.

“That patience helped push bitcoin to new highs earlier in the year,” he said. “But leverage remains elevated, and the October liquidation wave highlighted how fragile price discovery can be when positioning is crowded.”

Looking ahead, geopolitical risks and leverage conditions are expected to shape market dynamics in 2026. For now, crypto markets remain braced for volatility, with downside risks firmly in focus as the year closes