Bitcoin Slips Below $63K as Prediction Markets Tilt to $55K Before Any Bounce

Bitcoin’s drawdown tightened overnight, briefly breaking below $63,000 and extending a retreat that now leaves the asset more than 49% off its early October all-time high of $126,080. The tape looks tired, and traders are increasingly positioning for another leg lower before any durable recovery.

Where the crowd is leaning matters right now. On Myriad— a prediction market platform owned by Dastan—participants assign roughly a 71% probability that BTC tags $55,000 before it ever sees $84,000. That bearish skew has strengthened by nearly 12% in a day, signaling that risk supply is rising as dip-buyers step back. As of publication, Bitcoin has edged to $63,829 after a 3% 24-hour decline, with an overnight low of $62,802—the weakest print on major aggregators since October 2024. One month performance sits at -28%.

The inflection isn’t just crypto-native. A fresh 10% global tariff on all goods imported to the U.S. took effect early Tuesday, defying a Supreme Court decision last Friday that deemed the administration’s international trade actions unlawful. President Donald Trump has escalated his rhetoric on Truth Social, suggesting he’s prepared to take harsh measures against countries he says have exploited the U.S. for decades. That policy standoff injects uncertainty into growth, earnings, and global liquidity—variables that often dictate where crypto trades on the risk spectrum.

Here’s the crux: Bitcoin still trades like a high-beta liquidity proxy, not a crisis hedge. As Jimmy Xue, COO and co-founder at infrastructure firm Axis, noted in a client update, the real risk this week is “policy whiplash” between curtailed emergency tariff powers and a pivot to Section 122 duties—an unstable setup that markets struggle to price cleanly. In those regimes, allocators frequently unwind what they can, not just what they should, and BTC screens as a high-growth asset to trim.

You can see that in cross-asset flows. Gold has reasserted itself as the volatility hedge of choice during risk-off episodes. Spot eased 1% in the past day to $5,154 per ounce, yet remains 2.39% higher month over month and up a striking 54% over six months, per Goldprice. That divergence—gold bid while BTC softens—reinforces that many investors still treat Bitcoin as cyclical risk rather than defensive ballast when policy and legal frameworks get messy.

From a market-microstructure lens, the Myriad probabilities aren’t just vibes; they mirror how traders think about path-dependence. A slip to $55,000 would flush late longs, clear clustered stops, and force deleveraging in perpetuals—conditions that can reset funding and build a healthier base for a subsequent move toward $84,000. Without that washout, rallies often stall because positioning and psychology remain misaligned.

The psychology angle matters. After a 50%+ peak-to-trough move, narratives tend to polarize: some anchor to the prior top and expect symmetry on the way back, while others extrapolate weakness into a spiral. Both camps can be wrong. What usually resolves the stalemate is a level that feels uncomfortable enough to reprice conviction—$55,000 fits that bill if the prediction markets are reading the room.

From a business and ethical standpoint, sudden policy pivots and legal tussles create real planning costs. Corporates and investors hesitate when the rules of engagement feel fluid; that hesitancy constrains risk budgets and dries up marginal liquidity. Crypto doesn’t exist outside that ecosystem—its cost of capital and allocation share shift with every macro shock.

None of this precludes a sharp rally if policy clarity improves or if a squeeze catches the market leaning. But until the tariff-versus-court narrative stabilizes and risk appetite returns, it’s reasonable that traders price further stress. For now, the market is voting that pain comes before progress.