Bitcoin’s current challenge may have less to do with fear or macro headlines and more to do with a quieter problem: the market is struggling to find who buys next.
At higher price levels, Bitcoin increasingly relies on replacement demand rather than fresh accumulation. When that replacement fails to appear, even modest selling can push prices lower in search of equilibrium.
Key Takeaways
Bitcoin is facing a potential demand vacuum as new buyers fail to replace existing holders.
Capital is increasingly fragmented across the crypto market, weakening BTC’s dominance.
A deep price reset would reflect supply-demand mechanics rather than a breakdown of Bitcoin itself.
This is the condition Bloomberg Intelligence strategist Mike McGlone says investors should be watching.
When Ownership Becomes a Constraint
Bitcoin’s supply is not evenly distributed. A significant portion is held by long-term owners who entered far below current prices. That concentration worked in Bitcoin’s favor during accumulation-heavy phases, when large buyers quietly absorbed supply.
Today, that same concentration creates fragility. Capital already deployed cannot return as new buying power. And when unrealized gains dominate the holder base, selling pressure does not need to be aggressive to overwhelm demand.
McGlone argues that this imbalance leaves Bitcoin vulnerable during periods of market stress.
Capital No Longer Has a Single Destination
Another major change lies outside Bitcoin itself. Crypto capital is no longer funneled into one dominant asset. Instead, it is scattered across an enormous universe of tokens, protocols, and themes.
In earlier cycles, Bitcoin absorbed the majority of inflows almost by default. Now, funds rotate between sectors, narratives, and instruments. That diffusion weakens Bitcoin’s ability to rebuild momentum once a rally stalls.
A Path Toward $10,000 Bitcoin –
“We buy Bitcoin with money we can’t afford to lose.” Michael Saylor, at the Economic Club of Miami event last evening.
I admire and respect Mr. Saylor, and it was his arrival in 2020 — when Bitcoin traded near $10,000 — that helped fuel the 10x… pic.twitter.com/0CDBxCZYYc— Mike McGlone (@mikemcglone11) December 16, 2025
According to McGlone, this environment resembles late-stage markets in other asset classes, where prices remain elevated even as underlying demand erodes.
Why Institutional Flows Lost Their Impact
Regulated access vehicles did bring meaningful capital into Bitcoin. But those flows were front-loaded. Once allocations were made, the buying impulse faded.
The same applies to corporate treasury exposure. Large positions may signal conviction, but they do not function as recurring demand. From a market-structure perspective, they are static.
McGlone’s view is that once these sources plateau, Bitcoin must either attract a new buyer class or adjust downward to find one.
A Reset Is About Price Discovery, Not Failure
In this framework, a sharp decline would not represent Bitcoin “breaking,” but rather repricing to a level where demand naturally returns.
McGlone frames potential downside not as a forecast driven by emotion, but as a mechanical outcome of supply-demand imbalance. Historically, markets resolve such imbalances through price, not patience.
That is how levels once considered distant can re-enter the discussion – not as targets, but as zones where capital might again be willing to step in.
