As 2025 draws to a close, Bitcoin is poised for its first yearly drop since 2022, weighed down by broader economic headwinds and waning upward momentum in the crypto space.
Even though the cryptocurrency hit a new all-time high earlier this year, it has struggled to hold onto those gains since October. Last month alone saw its sharpest monthly decline since mid-2021, putting it on course for an annual loss exceeding 6%—a stark contrast to the strong gains it posted in the prior two years. As of late trading, Bitcoin was sitting around $87,474.
Linh Tran, a senior market analyst at XS.com, pointed out that 2025 really highlighted how Bitcoin is starting to behave more like a traditional risk asset. “The market showed that bitcoin increasingly exhibits the characteristics of a risk asset within the global financial system, with a notable correlation to the U.S. equity market during multiple periods,” she noted.
Experts attribute much of this volatility to Bitcoin’s movements increasingly mirroring stock market trends, especially as more everyday retail investors and big institutions have piled into crypto. Looking ahead to 2026, this link could grow even tighter, influenced by things like changes in interest rates and concerns over sky-high valuations in AI-driven stocks.
In the past, Bitcoin often marched to its own beat, viewed as an alternative to mainstream investments. But with wider adoption from conventional players, that independence is fading, and its price swings are syncing up more with broader market sentiment, analysts say.
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