Bitcoin Correction May Deepen Further Before Rebound—Only 9% of Supply Currently at Loss

Bitcoin’s recent pullback might not be over just yet—despite the panic, only 9% of the entire supply is sitting at a loss. That’s a surprisingly low number, historically speaking.

What’s really happening?

This isn’t a full-market capitulation. Not even close. Most holders are still comfortably in profit, which means there’s room for more downside before weak hands get shaken out.

Timing the bounce? Good luck.

Markets like this love to punish the overeager. Retail rushes in trying to catch the knife—institutional players just wait for the blood to dry. Classic.

When sentiment’s this shaky, even minor sell-offs can snowball. But don’t confuse a flush with a failure. Bitcoin’s weathered far worse.

So is this a dip to buy or a slide to avoid? Depends on your timeframe—and your tolerance for pain.

Either way, if you’re waiting for that “all-clear” siren from the usual finance gurus… maybe don’t hold your breath. Most of them are still trying to figure out how shorting works.

Not The Peak of This Cycle

The depth of the correction from the August 14 peak of just over $124,000 is currently around 13.4% when the asset double-dipped to $107,500 earlier this week. In the bull market of 2017, BTC fell 36% in September, and in 2021, it fell 24% this month before recovering in the fourth quarter.

However, those previous cycles did not have the massive buying pressure from institutional investors such as ETFs and BTC treasury companies, so this correction could remain muted.

Entrepreneur Ted Pillows observed that the recent correction mimics the Q2, 2025 and Q3 2024 dumps when the asset fell by 30%.

“I’m not saying that it’ll happen again, but bitcoin could go below $100,000.” “As I have said before, this isn’t the top, but just a normal correction before a new ATH,” he added.

$BTC recent correction mimics the Q2 2025 and Q3 2024 dumps.

Both had a 30% correction before BTC bottomed out.

I’m not saying that it’ll happen again, but Bitcoin could go below $100,000.

As I have said before, this isn’t the top, but just a normal correction before a new… pic.twitter.com/SRg768EsCR

— Ted (@TedPillows) September 1, 2025

Meanwhile, MN Fund co-founder Michaël van de Poppe said that the closer we get to the Sept. 17 Federal Reserve meeting, when there is a 91% chance rates will fall, the less likely this correction will continue.

“Yes, we could have a deeper correction, and yes, I’m heavily buying that one, but the closer we get to the Fed meeting, the less of a chance I’d give the correction to continue, especially if BTC breaks through $112k.”

BTC Starts to Recover

Bitcoin is leading the markets on Wednesday morning in Asia, having tapped $111,500, climbing from an intraday low of $108,500 on Tuesday.

Aside from a few spurious dips, the asset has been climbing since Monday and now needs to recover key resistance at $112,000. Failure to break above this level could lead to a plunge to support at $105,000 and a deeper correction.

BTC has pulled total market capitalization up 1.3% on the day to reach $3.93 trillion at the time of writing.