Bitcoin (BTC-USD) hovered near $86,000 on Wednesday as Wall Street remained wary of a meaningful rebound heading into the end of the year.

Recent jitters over AI-related stocks and speculation over who will take over Fed Chair Jerome Powell’s position next year may be keeping a lid on prices.

“For a while, the market was convinced that ultra-dove Kevin Hassett was a shoo-in for the next Fed Chair role, but now Kevin Warsh — a far more hawkish candidate — appears to be emerging as the frontrunner,” Coin Bureau investment analyst and co-founder Nic Puckrin said.

Seasonal pressures are adding another headwind, as year-end tax-loss harvesting — or the selling of investments at a loss to offset capital gains — tends to pick up in December. Cryptocurrencies are among the assets where many investors are sitting on losses.

“This all makes for a lackluster end to 2025, and we could even see BTC fall below $80,000 if the rout continues,” Puckrin said.

Read more about today’s market action

Another overhang for the world’s largest cryptocurrency is that long-term holders, who still control a dominant share of supply, may not be done selling.

Compass Point analysts point out that 60% of token supply remains held by wallets with over $85 million worth of bitcoin.

Read more: What is bitcoin, and how does it work?

Spot ETFs and digital asset treasury companies collectively own 13% of the total bitcoin supply, leaving the majority owned by a concentrated group of “HODLers” that can collectively influence cycle.

“Since July 2025, this cohort has ramped up selling activity and continues to unwind today. Until this cohort normalizes selling activity, we remain cautious on BTC prices near-term,” analyst Ed Engel wrote in a note on Tuesday.

Bitcoin has sold off from its high of around $126,000 in early October amid “whale” selling by large investors, exacerbated by forced liquidations of leveraged positions.

The token is down about 6% year to date, on pace for its first meaningful decoupling from the S&P 500 (^GSPC) since 2014.

Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.

Click here for the latest cryptocurrency news, prices, updates, and more

Read the latest financial and business news from Yahoo Finance