Bitcoin’s Rollercoaster Ride: A Tumultuous Fall
Bitcoin enthusiasts seem to have it all lined up: support from Wall Street, favorable political conditions, and influxes of institutional investment. Yet, a significant player is notably absent—Larry.
After reaching a staggering $126,000 in October, Bitcoin experienced a dramatic crash that erased all its gains for 2025. This drop seemed particularly shocking given that this year was expected to solidify Bitcoin’s status in the financial world.
Wall Street is on an upward trend, and exchange-traded funds (ETFs) have been integrating cryptocurrencies into standard investment portfolios. Additionally, the Trump administration has fully endorsed cryptocurrencies.
Despite this, the market swiftly turned against Bitcoin, with its market cap plummeting by roughly $600 billion since that October high. Such volatility is often par for the course with cryptocurrencies, but this time the speed at which confidence has dropped is striking. There’s a notable lack of clear explanations for this swing.
As of 1:21 p.m. in New York on Monday, Bitcoin dipped by about 1%, landing at $92,513. There’s a palpable sense of anxiety rippling through trading desks and bubbling up on social media. Traders are revisiting old charts, debunking previous theories, and searching for buyers. With no established Wall Street strategy to predict Bitcoin’s behavior, many are reverting to the familiar four-year halving cycle model.
This halving is an event that reduces Bitcoin’s supply growth by half roughly every four years. Historically, this has triggered speculative booms followed by significant busts, but typically there’s been a delay, as miners, who operate the necessary computers to maintain networks, tend to sell when prices drop.
In the current cycle, the last halving took place in April 2024, with prices peaking in October. While this pattern seems consistent with past behavior, it’s uncertain whether it still holds true. The market seems increasingly influenced by wealthy buyers.
According to Matthew Hogan, chief investment officer at Bitwise Asset Management, “The current sentiment in the retail crypto market is very negative, indicating potential further downsides.” He speculates that many are afraid of a repeat of the four-year cycle and wish to avoid another drastic price plunge by exiting early.
There’s a lingering fatigue following the earlier soaring prices of cryptocurrencies. Retail investment has sharply declined. In early October, rising trade tensions led to significant liquidations right at a moment when leverage levels were high. Consequently, optimism faded, leaving the market vulnerable to sudden shifts in sentiment.
Interestingly, just when the pro-crypto narrative felt strongest—ETFs had amassed billions and Trump’s policies looked promising—momentum stalled. Some long-term holders have chosen to cash out, revealing a troubling sign that current valuations might not justify the premiums they once held.
Jake Kenneth, an analyst at crypto data firm Nansen, noted that currently, Bitcoin behaves more like a macro asset within institutional portfolios, largely reacting to broader market conditions instead of predictable supply events. This shift is concerning.
The general atmosphere in the market has taken a downturn. Risk appetites have contracted, with altcoins experiencing notable declines throughout the year. Trump’s backing hasn’t insulated cryptocurrencies from broader economic pressures or competition from emerging speculative trends like AI or stablecoins.
Mike McGlone from Bloomberg Intelligence has warned that in an environment where gold and stock prices are peaking, Bitcoin is merely “the tip of the iceberg of risk assets that is melting.” He anticipates continued declines in Bitcoin and other cryptocurrencies.
Even amid the recent downturn, Bitcoin remains significantly higher than its position after Trump’s election victory. But the current slump is particularly disappointing for those who expected the price to hit $200,000 by year’s end. One can’t help but wonder: if Bitcoin can’t capitalize on support from policy and growing mainstream acceptance now, then when could it?
For the time being, the fears surrounding history repeating itself might actually be influencing the market’s behavior, as Eric Balchunas, an ETF analyst at Bloomberg Intelligence, suggests. Yet, there’s room for disruption in the cycle.
Derek Lim, head of research at crypto market maker Caladan, shared that the Bitcoin bull runs in 2017 and 2021 weren’t solely driven by previous halving events, but were supported by an overarching factor: global liquidity. He noted that this liquidity might resurface now that the government shutdown has ended.
