Introduction
Bitcoin, the leading digital currency, has experienced a highly volatile year. In 2025, it achieved a historic high and has since faced sharp declines, setting the stage for a negative annual performance for the first time since 2022. Experts attribute this to macroeconomic uncertainty, primarily interest rate concerns, inflation, reduced risk appetite, geopolitical tensions, and technical factors such as low market liquidity and large holder sales.
Bitcoin’s Performance in 2025
The price of Bitcoin has retreated 6.3% year-to-date, currently trading at $87,663.80 per unit, still below its 2024 closing level of $93,557.20 according to Investing data.
Since reaching its all-time high of $126,186 on October 6, Bitcoin has experienced a 30.53% drop. Moreover, it is on track to record its worst quarter since 2022, with a current decline of around 22.6%, as per Coinglass data.
In contrast, Bitcoin saw significant price increases in 2024 (121.32%) and 2023 (155.62%).
Experts’ Perspectives
Gildardo Herrera, Strategy and Operations Director for LATAM at Bitget, stated that global macroeconomic uncertainty has marked the cryptocurrency market, particularly Bitcoin, in recent months.
“One of the main factors has been the intensification of fiscal and trade tensions between the United States and China, which increased risk aversion in financial markets,” he explained.
Furthermore, October market reactions were negative to statements by Federal Reserve Chair Jerome Powell, who highlighted the lack of internal consensus on future monetary policy steps by the Federal Reserve.
“This led to adjusted expectations and more volatile movements in risk assets. This scenario is compounded by profit-taking following the historic high reached in 2025, a natural movement after a strong upcycle,” he detailed.
Diego Albuja, Market Analyst at ATFX LATAM, asserted that Bitcoin’s decline is not an isolated movement but reflects a broader decrease in risk appetite.
“For most of the year, Bitcoin has functioned as a proxy for risk assets, so its recent underperformance may anticipate additional pressures on the Nasdaq if historical correlations reassert themselves,” he affirmed.
Albuja considered that the market has diminished cryptocurrencies’ prominence, with enthusiasm now concentrated more intensely on the artificial intelligence sector, diverting capital flows to technology companies associated with this growth.
Declining Cryptoassets
The cryptocurrency market has experienced significant volatility, erasing most of the early-year gains.
The poor results led to a $320,000 million loss in market value for the year, bringing the total to $2.94 trillion, according to CoinMarketCap.
Since peaking at $4.28 trillion in October, the market has lost nearly a third of its value, down $1.34 trillion.
Ethereum, the second-largest by market capitalization, has seen a 12.44% decline this year, trading around $2,923.
Other digital currencies also show downward trends: Solana (-35.62%), Cardano (-58.96%), Litecoin (-26.11%), and Ripple (XRP) (-11.56%). Dogecoin has the worst performance, with a 60.82% drop.
Crypto Funds Withdrawals
Investment products in digital assets recorded their first weekly outflow, with $952 million leaving the market amid delays in key U.S. crypto legislation, prolonging regulatory uncertainty.
Nearly all of these withdrawals occurred in the U.S., totaling $990 million, according to CoinShares’ report.
These outflows were partially offset by modest inflows into Canadian ($46.2 million) and German ($15.6 million) crypto products.
CoinShares analysts attributed the shift to “delays in the approval of the U.S. Clarity Act, prolonging regulatory uncertainty for the asset class, along with concerns over whale selling.”
Ethereum-based products bore the brunt of sales, experiencing $555 million in outflows. “This is understandable given its potential gains or losses with the Clarity Act,” the report noted.
Bitcoin-based products saw $460 million in outflows. The negative flows occurred amid stagnant prices while investors and other market participants prepared for December festivities.
