Bitcoin (BTC) experienced a sharp decline below $83,000 late Monday, as several factors—including thin liquidity, macroeconomic concerns stemming from Japan over the weekend, and growing worries about a potential change in MSCI's methodology—conspired to send prices into a rapid and disorderly slide. Prices hovered above $85,000 during Asian trading hours on Tuesday morning, with XRP, Ethereum (ETH), Cardano (ADA), Solana (SOL), and BNB all posting losses of up to 2%.
Market participants indicated that the decline was not primarily driven by typical macroeconomic catalysts, but rather by the market's inability to absorb even modest pressure in the current environment. Farzam Ehsani, CEO of the cryptocurrency exchange VALR, stated: Bitcoin's drop below $90,000 is a result of the clash between the fragile market structure and the weak liquidity conditions observed over the weekend. He added: The pressure intensified across the markets because the order book was shallow, and the market lacked the depth to withstand another macroeconomic liquidity shock.
The threat of changing the MSCI methodology increases structural uncertainty.
Some traders are increasingly focusing on a separate structural issue: MSCI’s impending decision on whether to exclude companies whose balance sheets are heavily concentrated in cryptocurrencies from its global indices. This proposal affects companies that collectively hold more than $137 billion in digital assets—including Strategy&, Marathon, Riot, MetaPlant, and American Bitcoin—representing roughly 5% of all Bitcoin in circulation.
