Bitcoin Wipes Out 2025 Gains As Macro Headwinds Trigger Deep Market Correction
Bitcoin has entered a sharp corrective phase, erasing all its 2025 gains barely a month after notching a new all-time high. The world’s largest cryptocurrency has been dragged lower by mounting concerns over the U.S. economy, tightening liquidity conditions, and shifting rate expectations.
The crypto market had surged earlier this year after President Donald Trump approved a slate of pro-crypto legislation, sending Bitcoin to a record US$126,251 on Oct. 6. But momentum has since flipped. On Nov. 18, Bitcoin broke below US$90,000, meeting the commonly used threshold for a bear-market entry.
As of Thursday, Bitcoin was trading at US$92,508.75—about 2.4% below its Jan. 1, 2025 level of US$94,771.56.
ETF Outflows Hit Records as Sentiment Turns
Bloomberg reported that Bitcoin’s downturn has triggered unprecedented outflows from the iShares Bitcoin Trust (IBIT) ETF. The product saw US$523 million in net withdrawals on Tuesday—its largest single-day outflow since inception.
IBIT is now 8.4% down year-to-date, mirroring the broader retracement in crypto benchmarks.
Deribit chief commercial officer Jean-David Pequignot said the current correction “not only wiped out the 2025 gains but also broke through critical long-term support,” placing the next downside markers at US$83,000–US$85,000.
BTC Markets analyst Rachael Lucas added: “Technically, this puts us in a bear market.”
Macro Pressure: Fading Rate-Cut Hopes and Liquidity Stress
The sell-off is largely macro-driven. Expectations of a December U.S. Federal Reserve rate cut have fallen to around 50%, from nearly 70% earlier this month, Pequignot noted. Persistent inflation, mixed labor data, and reporting delays caused by the recent government shutdown have added uncertainty.
“With markets pricing in fewer Fed cuts, some of the short-term ‘cheaper money’ thesis around Bitcoin has unwound,” said Edward Carroll, head of MHC Markets at MHC Digital Group.
Carroll emphasized that Bitcoin’s decline is part of a broader liquidity squeeze: “This isn’t a crypto-specific story. It reflects tightening conditions across the global funding system.”
Crypto assets, known for their high sensitivity to liquidity cycles, have reacted faster than traditional risk markets, analysts said.
Whales Accumulate as Prices Slide
Despite the sharp pullback, on-chain data shows large Bitcoin holders—or “whales”—are buying the dip. Pequignot said the pattern signals “smart-money accumulation at undervalued levels.”
Independent Reserve data revealed one of the largest recent transactions: a major Bitcoin accumulator known as Strategy purchased 8,178 BTC worth US$835.6 million, averaging US$102,171 per coin.
Fundamentals Untouched, Institutions Eye Opportunities
Market analysts stressed that Bitcoin’s retreat does not signal fundamental weakness. Rather, it reflects tighter funding conditions and the recalibration of rate expectations.
Carroll said institutions could view the downturn as a buying window: “ETF flows, rising stablecoin market caps, and increased derivatives hedging all point to crypto’s growing maturity. Liquidity-driven dips often present entry opportunities.”
He added that digital assets historically rebound ahead of other risk assets once liquidity cycles reverse: “If past cycles are any guide, crypto will be the first to recover when conditions ease.”
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