Bitcoin’s inability to reclaim $90,000 exposes a deep structural fracture that could trap investors during the next unwind

Bitcoin's failure to reclaim $90,000 is attributed to a deep structural fracture in market plumbing, rather than narrative issues, following a violent 30% unwind on October 10, 2025, which erased $20 billion in leveraged positions. This event fundamentally altered risk appetite, leading dealers to tighten limits and resulting in significantly reduced market shock absorption.

The resulting brittleness is visible in lower trading volumes, which hit their lowest level since June 2025, and a sharp decline in market depth. Data shows Bitcoin’s aggregated 2% market depth has fallen about 30% from its 2025 high, meaning the market cannot absorb large flows without significant slippage, as seen by Binance's 1% market depth dropping from over $600 million to under $400 million.

Furthermore, liquidity is migrating off visible exchange order books due to factors like sustained ETF outflows (over $5 billion since Oct. 10) and the SEC permitting in-kind creations/redemptions for ETPs. This internalization of private liquidity creates a paradox where Bitcoin feels mechanically fragile; while it is institutionally held, stress causes spreads to widen and activity to ricochet onto public venues when public depth is weakest.

(Source：CryptoSlate)