The cryptocurrency market is facing an unprecedented storm on Wednesday, 22nd October 2025, with prices plummeting and panic spreading among investors. Factors such as aggressive selling by long-term holders (LTH) and volatility tied to imminent economic data are fueling this turmoil. Let's delve into the current dynamics.
Recent data, illustrated by the Long-Term Holder Binary Spending Indicator, reveals an acceleration in selling by long-term Bitcoin holders. Since early 2025, spikes in “moderate spending” (yellow) and especially “heavy spending” (pink) have coincided with sharp price drops, particularly around January 2024 and October 2025.
On X, analysts like @easyeight08 are pointing the finger at Binance, accusing the exchange of massive selling with unprecedented selling pressure. These LTHs, who had been holding their BTC as a store of value, now appear to be liquidating their positions, perhaps under duress or in anticipation of a deeper market decline.
This trend is amplifying on Binance, where rumors of strategic disengagement or internal problems (related to potential lawsuits) are circulating, exacerbating panic in the market.
Another hypothesis is gaining traction: A capital rotation toward Bitcoin ETFs. According to recent revelations, investors might be anticipating an imminent announcement favoring ETFs, prompting them to sell their direct holdings to reallocate toward these regulated products.
This transition, if confirmed, could drain liquidity from exchanges like Binance, accentuating downward pressure. Historically, ETFs have changed market dynamics by attracting institutional capital, but their impact remains ambiguous: they can stabilize in the long term while triggering massive sales in the short term. This regulatory uncertainty, combined with LTH sales, creates an explosive cocktail.
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Finally, volatility is intensifying as we approach the release of Consumer Price Index (CPI) data this Friday. With an already fragile market, these figures could seal the fate of cryptocurrencies. Higher-than-expected inflation could push the Federal Reserve to maintain high interest rates, penalizing risk assets like Bitcoin. Conversely, moderate inflation could revive hopes for rate cuts, but the lack of clear data before Friday keeps traders on edge.
This “perfect storm” of volatility, exacerbated by the partial closure of US government agencies, amplifies speculative movements.
The current cryptocurrency market collapse therefore results from a convergence of factors: aggressive selling by LTHs, likely amplified by Binance’s actions, a potential rotation toward Bitcoin ETFs, and extreme volatility linked to upcoming CPI data. As Bitcoin’s price oscillates under pressure, investors should remain cautious. This crisis could mark a turning point, either toward consolidation or a deeper correction. Worth watching closely in the coming days.
Currently at $108,000, Bitcoin must maintain above $107,400 to avoid dropping further to $102,000, or even below $100,000 in the coming days.
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Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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