Post by : Badri Ariffin

Bitcoin, the preeminent cryptocurrency, has seen its earlier momentum fade, sliding below $93,700 over the weekend and nullifying gains accrued since January. Just a month ago, Bitcoin peaked at an all-time high of $126,251 due to growing optimism following supportive government policies towards crypto.

The downturn commenced after surprising comments regarding trade tariffs stirred global market unease, prompting investors to reevaluate their exposure to riskier assets. As of Monday morning in Singapore, Bitcoin had slightly recovered to $94,869 yet still fell short of its end-of-year closing figures.

Market Shake-Up from Institutional Retreat

Throughout much of 2025, significant institutional interest has elevated Bitcoin’s standing. Exchange-traded funds (ETFs) and corporate treasuries have facilitated an ongoing capital influx, with ETFs alone investing over $25 billion, boosting assets under management close to $169 billion. This institutional backing has framed Bitcoin as a protective measure against inflation and financial uncertainty.

Nonetheless, recent months have seen major buyers retreat, removing a critical layer of demand. This shift aligns with a broader downturn in tech stocks, hinting at a waning appetite for risk among investors.

Profit-Taking and Market Dynamics

The present decline is a result of various influences: profit-taking by long-term holders, institutional withdrawals, and reduced leveraged positions. Bitcoin, which accounts for nearly 60% of the $3.2 trillion crypto market, has a history of boom-and-bust cycles, marked by rapid climbs followed by steep corrections.

Smaller, less liquid cryptocurrencies have faced even harsher losses, with some plummeting over 60% this year. Traders typically gravitate towards these tokens during market rallies for higher profits, yet they suffer greatly during downturns.

Market Sentiment and Future Outlook

Investors’ mood in the crypto market has soured, with many cautious about potential drawdowns. Following a series of volatile periods and previous market selloffs, participants are adopting a wait-and-see approach until stability is reestablished. The recent upheaval underscores the cyclical characteristic of digital assets and their sensitivity to political and macroeconomic shifts.

#Global News