Risk-Off Pressure, Miner Supply Re-Emerges, and Defining Downside Clusters

Sean Farrell

Discussed in today’s video:

  • Risk-off tone led by growth equities. Crypto began selling off Sunday night, effectively front-running a broader risk-off move across equities. The decline coincided with renewed weakness in SaaS and other AI-exposed growth stocks, which accelerated lower as the AI disruption trade extended. Given crypto’s persistent correlation to higher-duration growth assets, it followed that weakness.
  • Macro crosscurrents remain in play. The move is consistent with the macro pressures I highlighted last week, including stretched positioning across risk assets and fragile sentiment.
  • Miner supply is moving from theory to confirmation. In December, I flagged publicly traded miners’ ~100,000 BTC holdings as a potential headwind. Recent disclosures validate that concern. BTDR has reduced its BTC holdings to zero, accelerating sales over the past several weeks. The company raised capital through a convertible note and equity issuance, allocating proceeds primarily toward debt restructuring and expansion into data center, AI, and HPC infrastructure.
  • Miner selling remains a marginal headwind. Over time, depleted treasuries should reduce incremental supply-side pressure. For now, however, this represents a modest but real source of overhang.
  • BTC valuation frameworks cluster near $50K. MVRV currently sits around 1.2x. Historical troughs suggest a plausible cycle bottom between 0.85x and 0.95x, implying BTC near $49K at 0.9x. The MVRV Z-score, currently around -0.82, would imply roughly $48K if it revisits a slightly shallower trough than last cycle. The 300-week moving average also sits near $50K. Independent measures converge in the $48K–$52K range as a reasonable downside cluster.
  • ETH downside framework. ETH’s recent relative strength likely reflects legitimate stablecoin and tokenization tailwinds, though DAT-driven demand may have pulled some flows forward. A retracement to the prior breakout zone near 0.024 ETH/BTC would imply roughly $1,200 ETH if BTC were trading near $50K.
  • SOL downside framework. A return to the October 2023 breakout zone in SOL/BTC near 0.0009 would imply roughly $45 SOL at a $50K BTC price. This level sits modestly below our earlier $50–$75 range and would represent a full retracement of the “redemption-arc” breakout.
  • Bottom Line: My confidence in near-term stabilization is waning, though it remains my base case. That said, I continue to believe annual lows are likely still ahead. Valuation and long-term moving-average frameworks point to lower support zones that should be defined in advance rather than reacted to in real time. Risk management remains paramount in the current regime.
Risk-Off Pressure, Miner Supply Re-Emerges, and Defining Downside Clusters

Tickers in this video: BTC -0.96% ETH -0.99% SOL

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