It’s been a brutal time for the crypto market, which was booming as recently as early October. On Thursday, Bitcoin, the original cryptocurrency, bottomed below $87,000. Its price is down about 14% since last week.
Altcoins like Ethereum and Solana also plunged. The former is down 13% over the past week to its current price of around $3,000, and the latter is down 9% over that time to its current price of $139. Meanwhile, the stock prices of public crypto-focused companies aren’t faring any better, as Strategy and Circle are down about 16% and 20%, respectively, in the past week.
This rout comes at a time when many thought 2025 would be a boon for crypto thanks to President Donald Trump’s favorable regulatory stance toward the sector. This has been true for most of the year, as Bitcoin has outperformed the S&P 500. However, since October 6, Bitcoin is down about 31% from its all-time high price of around $126,000, compared to the S&P 500’s gain of around 3%. This is largely due to the crypto flash crash in October, caution from the Federal Reserve, and investors’ tendency to avoid the assets risky.
“Markets are essentially flying blind right now, deprived of meaningful macroeconomic data and stabbing in the dark. This void has triggered a broad sell-off of risky assets,” said James Butterfill, head of research at CoinShares. “A sharp revision to expectations for a December Fed rate cut fueled the selling.”
The recent crypto slide began on October 10, when traders experienced the largest liquidation event in history, according to analytics firm CoinGlass. This event came after Trump threatened China with a new round of tariffs. Since then, macroeconomic factors have only cemented crypto’s decline as the likelihood of another rate cut by the Fed continues to diminish.
Vetle Lunde, head of research at K33, took an optimistic stance in a report released Tuesday, highlighting the broader institutional adoption of crypto this year. “We expect better times ahead due to accelerated institutional adoption in an expansionary monetary environment,” he wrote.
Lunde predicts that Bitcoin will bottom between $84,000 and $86,000 before recovering. He says previous withdrawals have lasted more than 50 days and the current one only takes place on the 43rd day.
