While Bitcoin enthusiasts were still nursing hangovers from the cryptocurrency’s recent flirtation with $124,000 highs, the digital asset delivered a sobering reminder that gravity applies even in cyberspace, plunging below the psychologically critical $110,000 support level on August 26, 2025—its first such breach in over a month.
Bitcoin’s sobering plunge below $110,000 proved that even digital assets can’t escape gravity’s relentless pull.
The dramatic descent to lows between $108,666 and $110,184 represented a sharp 3.2% decline, wiping out gains that had materialized just days earlier following Federal Reserve Chair Powell‘s dovish signals about potential policy easing.
The carnage extended far beyond Bitcoin’s borders, with Ethereum experiencing an even more brutal 8% correction that left traders questioning whether the crypto winter had returned with a vengeance.
The synchronized selloff triggered a liquidation tsunami exceeding $800 million within 24 hours, obliterating over 179,700 traders who had apparently mistaken leverage for genius. Bitcoin alone accounted for $267 million of these forced closures, with 82.44% representing collapsed long positions—a demonstration of the dangerous optimism that had pervaded the market.
Technical indicators painted an increasingly dire picture as Bitcoin sliced through its 100-day exponential moving average at $110,800 and tumbled below the Ichimoku cloud, transforming what had been bullish momentum into bearish capitulation.
Volatility exploded from 15% to 38%, while double-top formations and declining volume suggested the correction was far from over.
The selloff coincided with broader risk-off sentiment as traditional markets stumbled, creating a perfect storm of macroeconomic uncertainty ahead of the Federal Reserve’s September meeting. The market turmoil reflected what experts characterize as changing rate expectations following initial enthusiasm over potential Federal Reserve policy shifts.
Adding fuel to the fire, a major Bitcoin holder dumped 24,000 BTC, intensifying derivative market liquidations and exposing the fragility of overleveraged positions.
Paradoxically, institutional appetite appeared undiminished, with Bitcoin spot ETFs recording $219 million in fresh inflows despite the chaos.
Strategy accounts opportunistically accumulated 3,081 BTC during the decline, suggesting sophisticated players viewed the correction as a buying opportunity rather than capitulation. The selloff particularly impacted the mining community, where operators faced immediate pressure from reduced profit margins as Bitcoin rewards became temporarily less valuable.
Market observers now eye critical support levels at $105,000 and $100,000, with a notable CME futures gap near $93,000 serving as a potential magnet for further downside.
Whether this represents mere profit-taking or the beginning of a deeper correction remains the million-dollar—or should we say, million-satoshi—question.
