Mike Smith
3 days ago
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The finish of 2025 turned out to be sobering for Bitcoin: after a record-breaking surge in the fall, the digital asset came to the end of the year with negative dynamics - the first annual drawdown since 2022. At the peak in October, quotes were above $126,000, but by the end of December, the price fell back to $87,474.2, reminding how quickly risk appetite changes when the external environment is no longer friendly.
The catalyst was Washington's announcements on tariffs and export restrictions. This quickly put investors on the defensive: a wave of forced position closures began in the crypto segment. Observers estimate that liquidations exceeded $19 billion, making it the largest episode of its kind for the class. Leverage accelerated the fall, and automatic stops and margin calls made the movement abrupt and costly.
Another trend strengthened over the course of the year: Bitcoin is behaving more and more noticeably as a “risk asset.” It rises when portfolios are more willing to take on volatility and declines when uncertainty rises - following rules familiar to the equity market. For managers, this means a new logic: BTC is more often included in the same risk-basket as the technology sector, and decisions on it are made in the same place where VaR limits, stress tests and cross-asset correlations are discussed.
Institutions are having to rearrange the operational side: holding a thicker liquidity cushion, planning in advance for derivatives collateral and prescribing scenarios to reduce positions. For corporate treasuries that view Bitcoin as part of reserves, discipline - from rebalancing regulations to reporting to the board of directors - comes to the fore.
At the same time, the sector has received a number of regulatory positives in the U.S.: some of the SEC proceedings have been closed, and discussions on federal rules for dollar tokens are nearing finality. But the broader “market structure” framework is still in the works, and it is this pause that is holding back the influx of long money, which cares about custody standards, auditing and intermediary requirements.
Against this backdrop, corporate and political activity around digital assets has intensified, with companies and associations pouring more than $245 million into supporting candidates and initiatives, hoping to accelerate the formation of understandable regulations. Investors have to keep an eye not only on the BTC chart, but also on the calendar of macro publications, trading decisions and regulatory deadlines, which is where the most expensive moves are now born.
