Jefferies says the recent crypto selloff shows little sign of an imminent bottom, even as bitcoin and ether hover near levels that have historically drawn dive buyers.
In a research note this week, the bank described the downturn as a liquidity-driven correction rather than a collapse in blockchain activity, pointing instead to continued network usage and selective corporate bitcoin accumulation as evidence that the sector’s underlying infrastructure remains intact.
This comes as bitcoin is trading near $64,800, about 47% below its October 2025 peak of around $123,500, while ether is trading around $1,900, down nearly 60% from its previous cycle high.
Jefferies wrote that sharp price declines have revived familiar “crypto winter” narratives, but argued that the current weakness is more closely tied to broader risk-off sentiment in global markets and a rotation away from growth assets than to any deterioration in blockchain fundamentals. More than $2 billion in recent long liquidations has further amplified day-to-day volatility across major tokens.
The bank highlighted selling by large bitcoin holders and sustained spot ETF net outflows as key near-term headwinds, suggesting that institutional portfolio reshuffling is exerting more pressure on prices than retail behavior.
At the same time, Jefferies noted that smaller and mid-cap holders appear to be holding onto existing positions rather than aggressively exiting, while centralized exchange trading volumes and decentralized lending activity have begun to stabilize after recent increases.
Despite its cautious tone, the report stops short of a fully bearish point of view. Jefferies said long-term catalysts such as regulatory progress, infrastructure maturity and greater participation of traditional finance could ultimately drive renewed interest in tokens linked to monetized blockchains, leading to wider performance divergence rather than a uniform recovery.
