With 2025 coming to an end, the former president's supportive approach towards cryptocurrency has failed to suffice to sustain the sector's advances, previously the driver behind market-wide hope and enthusiasm. The final quarter of 2025 witnessed an estimated $1 trillion in market capitalization wiped from the digital asset market, even after bitcoin hitting an all-time-high price of $126,000 on October 6th.
The October price peak proved temporary. The flagship cryptocurrency's value tumbled shortly afterward following a declaration of 100% tariffs on China sent shockwaves across the market on October 12th. The crypto market experienced an unprecedented $19 billion wiped out within a day – the largest liquidation event on record. The second-largest crypto, Ethereum, endured a 40 percent decline in value over the next month.
The industry was delivered the pro-bitcoin president it had anticipated during the campaign. Shortly of taking office, an executive order was issued rolling back restrictions on digital assets and introduced business-friendly rules alongside a presidential working group on digital assets.
“Cryptocurrency is a vital component for technological progress and economic growth nationally, as well as America's global standing,” stated the document.
Again in spring, a new strategic cryptocurrency reserve sparked a significant market surge, with values for several named coins jumping more than sixty percent. Bitcoin itself rose ten percent immediately following the news.
Cryptocurrency reacts strongly to both narratives and confidence in global markets, said a leading analyst. It’s what is called a speculative investment, an asset that does better when investors are feeling confident regarding economic conditions and are willing to take on more risk.
“The administration might support crypto, but tariffs and rising interest rates outweigh positive vibes,” the analyst added. “And it’s also just a reminder, particularly to people in crypto, that macro forces are far more significant than political stances.”
In November, BTC underwent its biggest drop in price since 2021, pushing its price to less than $81,000. While bitcoin regained some of that value afterward, the start of the final month with a fresh downturn, a 6% drop triggered by a leading corporate holder slashing its profit outlook due to the slide in digital asset values. Bitcoin’s price currently fluctuates around $90,000.
Some experts are concerned the industry is entering what's termed a prolonged bear market, a period of low activity and declining prices. The last such downturn persisted from the end of 2021 into 2023. That period saw bitcoin slump around seventy percent in price.
“This latest collapse does not reflect a shift in belief, but a collision of several key issues: the aftershocks of a massive leverage washout; investors fleeing risk driven by geopolitical trade disputes; and, importantly, the potential unraveling of corporate crypto holdings,” explained a noted economist.
Another potential factor impacting the crypto market is the downturn in share prices of artificial intelligence companies. “A key reason for the link to the AI cycle is because a lot of mining operations have shifted their power into new datacenters,” it was explained. “Pessimism in tech often spills over into crypto.”
Despite concerns about a bear market, prominent leaders in the crypto space voiced optimism in the future worth of Bitcoin. One executive said “there was no chance” the price of bitcoin would go to zero and in fact 2025 would be seen as the year “when crypto went from a fringe market to a mainstream institution”. Another pointed out increased interest from sovereign wealth funds.
Analysts suggest this downturn is not inconsistent with historical four-year bitcoin cycles and that a much more sustained crypto winter is not a certainty.
“From the perspective of a standard market cycle, we are actually technically in a bear market,” came the assessment. “However, it's clear, even with these major headwinds impacting the market, bitcoin has still managed to set a price above $80,000.”
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