How do analysts predict the future of Bitcoin after this crash?

Bitcoin’s $60K Crash: Is This the Turning Point in the Bear Market? Insights from Kaiko

Bitcoin’s swift drop back toward the $60,000 level in early 2025 has shaken market confidence just months after new all‑time highs. For traders and long‑term holders, the key question isn’t just “why did it crash?” but “does this mark a deeper bear market-or the final capitulation before the next leg up?”

On-chain and market structure data from research firms like Kaiko provide useful signals. Looking at liquidity, derivatives positioning, ETF flows, and macro context helps frame whether this is a trend reversal or a high‑volatility reset.

The Road to $60K: How Bitcoin Got Here

Bitcoin’s retrace has to be viewed in the context of its explosive run since late 2023.

From ETF Euphoria to Volatility Hangover

After the approval of U.S. spot Bitcoin ETFs in January 2024, BTC surged as institutional and retail flows poured in:

• Spot ETF AUM quickly climbed into tens of billions of dollars.
• Average daily spot volumes on major centralized exchanges rose significantly.
• BTC set new all‑time highs above its 2021 peak.

By late 2024 and early 2025, the market narrative shifted from pure ETF euphoria to:

• Slowing net ETF inflows.
• Rising expectations that the Fed might keep rates higher for longer.
• Realization that institutional flows are cyclical and sensitive to macro risk.

The recent drop toward $60K is less a random crash and more a stress-test of the new BTC market structure.

Kaiko’s Market Structure View: Liquidity, Volatility, and Slippage

Kaiko’s datasets focus on order book depth, spreads, slippage, and derivatives metrics across major exchanges. These indicators reveal whether the move to $60K shows healthy two‑sided liquidity-or a structural fragility.

1. Liquidity Around Key Levels

One of Kaiko’s key metrics is market depth (e.g., 1% or 2% bid-ask depth), which measures how much BTC can be traded before price moves a given percentage.

Typical Kaiko-style insights around the $60K zone:

• Order books often thin out below key psychological levels (like $60K), amplifying downside moves.
• Bid depth may contract sharply when volatility spikes, increasing slippage for market orders.
• Spot order books show more concentration around round numbers, leading to “air pockets” when those levels break.

A simplified snapshot of how liquidity can change during a drawdown:

When liquidity thins, even modest selling can push BTC much faster toward support levels like $60K.

2. Volatility and Derivatives Positioning

Kaiko and similar analytics firms track funding rates, open interest (OI), and options skew:

• Perpetual futures funding rates often flip negative during these drawdowns, signaling aggressive short positioning or long liquidations.
• A sudden decline in aggregate OI can reflect forced deleveraging-liquidations of overleveraged longs rather than a purely spot-driven sell-off.
• Options implied volatility (IV) tends to spike, especially on short-dated puts, as traders rush for downside protection.

These signals suggest the $60K move is not just spot selling, but a combination of:

1. Long leverage unwinding.
2. Short-term panic hedging.
3. Liquidity gaps around key price levels.

Bitcoin’s $60K Crash and the Bear Market Question

Is Bitcoin in a new bear market, or is this a high‑timeframe correction within an extended uptrend? There are several lenses to examine:

On-Chain and Macro Context

For a crypto-native, data-driven audience, a bear market isn’t just “price down.” It’s:

• Sustained decline in network activity (addresses, fees, transaction volume).
• Weak or negative ETF/spot inflows over multiple months.
• Deteriorating macro backdrop (tighter liquidity, stronger dollar, shrinking risk appetite).

As of early 2025:

• Bitcoin still benefits from a long‑term “digital gold” narrative amid persistent inflation concerns.
• Spot ETFs, while volatile, continue to provide a structural on‑ramp for institutional capital.
• Regulatory clarity has gradually improved in major jurisdictions, stabilizing the medium‑term thesis.

This backdrop is closer to a cyclical correction than a full structural bear, assuming macro conditions don’t deteriorate sharply.

Kaiko-Style Signals That Would Confirm a Deeper Bear

Watch for a clustering of negative signals, not just price action:

1. Sustained Liquidity Deterioration
• Persistent low order-book depth on major BTC pairs.
• Wider spreads even in normal trading conditions.

2. Prolonged ETF and Spot Outflows
• Multi-week net outflows from U.S. and international spot BTC products.
• Declining CEX spot volumes, not just derivatives repricing.

3. Volatility Regime Shift
• Volatility spikes, then remains elevated while price drifts lower.
• Options skew structurally favoring puts over a longer horizon.

If these metrics stay negative for months, the $60K crash looks more like the onset of a bear market than a normal drawdown.

Trading and Investment Implications: How to Use Kaiko-Like Data

For traders, builders, and funds in crypto and web3, the key is integrating market-structure analytics into strategy.

1. For Short-Term Traders

Use order-book and derivatives signals to manage risk:

• Monitor depth and slippage: Thin books mean smaller position sizes or using limit orders to avoid impact.
• Track funding and OI: Extended positive funding plus climbing OI near resistance often precedes liquidations; negative funding with falling OI can mark fear or capitulation.
• Watch options IV and skew: Elevated downside IV can create opportunities for volatility selling strategies if you understand the risks.

2. For Long-Term Allocators and Web3 Builders

Focus on structural indicators and adoption:

• ETF and institutional flows: Persistent net inflows, even during corrections, support long-term validity of BTC as a macro asset.
• Developer and ecosystem activity: Layer-2 growth, tokenization infrastructure, and BTC-based DeFi or RWA initiatives can decouple long-term value from short-term price.
• Regulatory and macro signals: Clarifying rules for custody, stablecoins, and tokenization continue to shape institutional participation.

A brief comparison of trader vs. investor focus:

Conclusion: $60K as Stress Test, Not Final Verdict

Bitcoin’s crash back toward $60,000 is a critical stress test of the post‑ETF, institutionally shaped market, not an automatic verdict that the bull run is over.

Key takeaways:

• Order-book and derivatives data from providers like Kaiko show that liquidity fragmentation and leverage still drive outsized moves.
• So far, the broader environment-ETFs, institutional presence, and macro hedging demand-resembles a volatile mid‑cycle correction, not a clear, multi‑year bear.
• The turning point will be defined by data: if liquidity returns, ETF flows stabilize, and on-chain activity holds up, $60K could be remembered as a painful but healthy reset.

For crypto-native traders and web3 builders, the edge lies in treating Bitcoin’s $60K crash not as noise, but as a real-time case study in market microstructure-using high-quality analytics to distinguish between narrative-driven fear and data‑driven trend reversals.