Bitcoin Inches Up After Erasing All 2025 Gains Amid Market Uncertainty
Bitcoin, the world’s largest cryptocurrency, showed a modest rebound on Tuesday after a steep decline wiped out all of its gains for the year 2025. The digital asset slipped below $90,000 on Monday for the first time in seven months, signaling a waning appetite for risk among investors in both crypto and broader financial markets.
According to market data tracked by CoinGecko, approximately $1.2 trillion has been wiped off the total market value of all cryptocurrencies over the past six weeks, highlighting significant turbulence in the sector. Bitcoin’s price dropped as low as $89,286.75 during European trading hours, before recovering slightly to around $91,338.47. This level represents roughly a 30 percent decrease from its peak of $126,000 recorded in October.
Market analysts attribute the recent selloff to growing uncertainties over the future of US interest rate cuts and an increasingly risk-averse environment. The US Federal Reserve’s steps on monetary policy continue to influence investor confidence, and doubts about upcoming rate reductions have contributed to the cautious mood.
Joshua Chu, co-chair of the Hong Kong Web3 Association, commented on the situation, stating, “The cascading selloff is amplified by listed companies and institutions exiting their positions after piling in during the rally, compounding contagion risks across the market. When support thins and macro uncertainty rises, confidence can erode with remarkable speed.”
Institutional investors and speculators who previously entered the market in anticipation of supportive regulatory policies in the United States are now retreating. Joseph Edwards of Enigma Securities noted that steady outflows from exchange-traded funds (ETFs) and similar investment vehicles have followed the October flash crash, during which leveraged positions lost nearly $19 billion in liquidations.
The downturn has also impacted public crypto treasury companies and firms involved in the ecosystem, with shares of miners such as Riot Platforms and Mara Holdings, as well as crypto exchange Coinbase, experiencing declines alongside Bitcoin’s price slide.
Standard Chartered has warned that if Bitcoin falls further below $90,000, about half of the Bitcoin holdings of publicly listed companies could become "underwater," meaning they would be worth less than the purchase price. Together, these listed companies hold an estimated 4 percent of all Bitcoin in circulation and 3.1 percent of Ethereum, the second-largest cryptocurrency.
Ethereum itself has been under pressure for months, having shed nearly 40 percent of its value from an August peak above $4,955. Matthew Dibb, chief investment officer at Astronaut Capital, summed up the market sentiment: “All in all, sentiment is pretty low in crypto and has been since the leverage wipeout of October.”
As cryptocurrency markets navigate these choppy conditions, investors remain attentive to central bank policies and broader market trends that will influence both digital and traditional asset classes moving forward.