Bitcoin Drops Below $115.8K, Leverage Dips as Market Awaits Catalyst
Bitcoin dropped decisively below key support at $115,800, hitting $112,210 after three weeks of tests. This breakdown coincided with a broad de-risking in the crypto market. The OTHERS index, which tracks altcoins outside the top 10, plunged 18.7% in ten days, erasing $59 billion before a minor rebound. On August 2, daily liquidations topped $1 billion, led by $922 million of long positions in BTC and ETH. Ethereum also closed the week down 9.7%, while the broader altcoin sector fell 11.4%. Structural divergence remains: Bitcoin’s market cap stands at $2.2 trillion—double its 2021 cycle peak—whereas altcoins lag. With ETF inflows cooling and macro pressure mounting—highlighted by sticky US inflation, slowing consumer spending, and a weaker labour market—further consolidation or downside appears likely unless fresh institutional buying or a clear macro catalyst emerges. On the institutional front, SharpLink Gaming added $295 million of ETH, raising its holdings to 438,000 ETH. SEC Chairman Paul Atkins unveiled “Project Crypto” to clarify token classification and encourage tokenised finance. Nasdaq-listed DevvStream allocated $10 million to Bitcoin and Solana for its sustainable treasury program.
Bearish
The sharp breakdown of Bitcoin below $115,800 and the broader liquidation event, with over $1 billion in daily liquidations, signal heightened risk aversion in the crypto market. Historically, similar high-leverage unwinds in 2021 and 2022 led to short-term price volatility and further declines before recovery. Macro headwinds—sticky US inflation, slowing GDP growth, and a weak labour report—reduce the likelihood of immediate Fed rate cuts, removing a key support driver for risk assets. While ongoing institutional buys, such as SharpLink’s $295 million ETH purchase and DevvStream’s allocation to Bitcoin and Solana, indicate growing long-term conviction, they have yet to offset current deleveraging pressures. Without renewed ETF inflows or a clear macro catalyst, traders may remain cautious, leading to consolidation or further downside. Therefore, the outlook is bearish in the short term, though maturing institutional demand could stabilise prices over the medium to long term.