This rout comes at a time when many thought 2025 would be a boon for crypto thanks to President Donald Trump’s friendly regulatory stance to the sector. That was true for most of the year, as Bitcoin outpaced the S&P 500. However, since Oct. 6, Bitcoin is down about 31% from its all-time high price of roughly $126,000, compared to the roughly 3% gain of the S&P 500. Much of that is due to crypto’s October flash crash, caution from the Federal Reserve, and the tendency of investors to steer clear of risky assets.
“Markets are essentially flying blind right now, starved of meaningful macro data and stabbing in the dark. That vacuum has triggered broad risk-asset selling,” said James Butterfill, head of research at CoinShares. “A sharp repricing in expectations for a December Fed rate cut has fueled the selloff.”
Lunde predicts that Bitcoin will bottom out at $84,000-$86,0000 before it recovers. He says that previous drawdowns have lasted more than 50 days, and the current one is only on day 43.
