After having touched record values above 126,000 dollars during autumn 2025, Bitcoin plunged in a few weeks below the threshold of 86-90,000 dollars, marking one of the worst corrections of 2025 as reported by New York Post.
The first week of December saw a further decline: in the first hours trading showed a collapse of 5-6%, enough to trigger massive liquidations in reversed positions (especially long).
The numbers speak for themselves: one of the most impactful liquidation events ever, with hundreds of millions of dollars”washed out” in a few hours.
The result? Not a simple loss of 16-17% in the month of November alone, but also a strong signal: trust in Bitcoin, and partly in the entire crypto sector, seems eroded.
The cause of the collapse is not just “speculative madness”
Large-scale exits from institutional funds
Much of the bullish push this 2025 had come from large flows into “spot-Bitcoin” funds, such as ETFs that allow institutional investors to buy BTC in a regulated way. However, in recent months, these funds have seen billions of dollars in outflows.
With the reduction in purchases, it was suddenly understood that behind the “boom” there was not stable demand, but mere speculation and moments of massive interest. This net change of sentiment it weakened the price support “core”.
Leverage, liquidations and the “domino effect”
The crisis was amplified by high leverage in positions: many investors had borrowed to buy Bitcoin, hoping for continued increases. When the price started to drop, they sprinted margin calls (request by a broker to integrate funds into a trading account because its value has fallen below a minimum safety threshold, the so-called “maintenance margin”) automatic: forced sales, which in turn induced other margin calls and so on, in a circle that accelerated the collapse.
According to some analysts, it was not just a physiological correction, but a “market structure” that failed: less liquidity, fewer aggressive buyers, more uncertainty.
Poor macroeconomic confidence and correlation with traditional markets
In a world where macro tensions (inflation), possible increases or uncertainties on interest rates increase with increasing distrust towards the markets, Bitcoin is no longer seen as “alternative safe haven asset”.
On the contrary: it seems increasingly linked to the performance of the global financial market.
Furthermore, the unfavorable wave on tech stock exchanges and “growth”, partly due to fears about an AI bubble, has also dragged with it the most speculative assets such as these types of alternative currencies.
Technical and trust factors in the crypto currency world
It is not just a question of extremely uncertain financial performance. Technical incidents in the DeFi (decentralized finance) sector, with hacks or bugs on related protocols, have increased distrust towards the entire crypto ecosystem, and those looking for a “safe” point tend to exit.
Furthermore, several “historical” investors took advantage of the highs to make significant profits by selling BTC, which increased the supply on the market, but without there being enough demand to absorb it.
The consequences for those who counted on Bitcoin and for the entire crypto system
As reported by Reuters, Companies that had placed strong bets on Bitcoin as a reserve (or strategic asset) are reviewing their accounts: expected earnings have evaporated, and some are even predicting significant losses.
The altcoins (alternative currencies), from Ethereum to smaller tokens, have been affected more violently: the fall in confidence in Bitcoin has dragged the entire sector with it.
The crypto market appears increasingly fragile and much more interconnected with traditional markets: the long history of independence (or presumed such) now seems like a memory.
For investors “retail“: those who entered late risk big, volatility remains very high. Those who have been in for a long time, however, could consider this as an accumulation phase (but only with great caution).
Is it really a “Trump-triggered crisis” as some say?
Reference is often made to a historical precedent, in 2025 or shortly before, when some political moves, including those of Donald Trump, would have destabilized the markets and indirectly affected Bitcoin. However, as recent data shows, the current fall is much more structural. It is not just a reaction to political shocks: behind it there is a complex mix of financial, macroeconomic, technological and psychological factors.
Furthermore, Bitcoin is currently much more integrated into traditional markets (institutions, ETFs, global investors) than it was in the past: consequently, it is more vulnerable to generalized shocks and speculative shocks.
What scenarios could arise for the future?
If the confidence of large institutional investors were to recover (new inflows into ETFs, companies buying back), we could see a rebound: but strong signals of stability and clear regulation will be needed.
If, however, fear remains, due to the unstable global economic context, the decline could continue: some analysts see products at 80,000 and even 75,000 dollars.
In any case, the “lateral” scenario must be taken into consideration: Bitcoin could stabilize in a lower price range, fluctuating, perhaps for months, until consistent demand returns.
Why the Bitcoin crisis is worthy of attention even “outside the crypto world”
This is not just a Bitcoin or token crisis: it is a sign that the once so-called “financial independence reserve” (the world of cryptocurrencies) has instead become an integral part of the global financial system, with all that it implies.
When the tide changes with the advent of highly variable interest rates and global economic crises not even Bitcoin can be immune.
