Bitcoin’s bullish outlook continues to deteriorate as participants shift to a risk-off stance.

The top crypto dropped below $99,000 after shedding nearly 4% from Thursday’s intraday high of $103,690, according to CoinGecko data, mirroring a broader risk-off sentiment in traditional markets.

“Nasdaq is down around 2% and Bitcoin off a similar amount, as investors digest the fallout from the U.S. government reopening after its longest shutdown,” Ryan McMillin, chief investment officer at crypto fund manager Merkle Tree Capital, told Decrypt.

The funding bill only offers a short-term reprieve, McMillin explained, suggesting that investors are focusing “on the damage already done.” 

That includes weeks of missing economic data, a federal statistical system described as “permanently damaged,” and the White House’s confirmation that October’s jobs report will be released without the unemployment rate.

Compounding the macro pressure is the accelerated distribution from Bitcoin’s long-term holders, according to a Glassnode report on Thursday. The 30-day change in supply held by long-term holders, which was already in negative territory, is falling sharply, indicating that these investors are “accelerating their distribution.”

“Long-term holder selling hit one of the highest levels so far this year as prices reached new highs, and at the time demand started to contract,” CryptoQuant analysts noted in a separate Thursday report.

These investors have sold roughly 815,000 BTC over the past month, increasing the selling pressure to the highest level since January 2024.

It also comes amid weakened spot demand due to net spot Bitcoin exchange-traded fund outflows, reduced U.S. buying pressure shown by a negative Coinbase premium, and a broader contraction in apparent demand, the CryptoQuant analysts explained.

“Whales selling in isolation isn’t usually significant. However, what makes it notable now is the lack of meaningful bid support on the buy side to absorb that selling.” Charlie Shery, head of finance at Australian crypto exchange BTC Markets, told Decrypt. 

“Earlier in the cycle, ETFs and MicroStrategy were providing steady demand,” Shery added. “Without those buyers, the recent sell-heavy flow appears to be driving the steady decline in Bitcoin we have seen.”

Meanwhile, users on prediction market Myriad, owned by Decrypt’s parent company Dastan, have assigned a 56% chance of Bitcoin hitting $115,000 before $85,000, down from Wednesday’s 68%.

Bitcoin’s range trading since early August could end if the $98,000 level fails to hold, McMillin noted, suggesting that it could drop lower into the $90,000 territory, similar to what occurred in June.

“The market is really looking for certainty to gain strength, but it is not clear where that is going to come from right now,” McMillin said.