Bitcoin’s bull run in 2025 was anticipated to be historic, with some experts predicting the largest cryptocurrency would soar to $180,000-$200,000 by the year’s end.
Historic it was. Just not in the expected manner.
Indeed, bitcoin surged to an all-time high earlier than many models estimated, reaching over $126,200 on Oct. 6. However, just four days later, a flash crash occurred, causing significant market turmoil and highlighting the fragile and unpredictable nature of digital asset trading.
Since then, bitcoin has declined by 30% from the October peak, dropping over 50% below various 2025 predictions. Rather than ascending, it fell by 6% this year, remaining mostly between $83,000 and $96,000 for the past two months, as per TradingView prices.
The crash in October shocked traders and eroded months of leveraged optimism in a matter of minutes. Yet, according to Mati Greenspan, founder of Quantum Economics, it was not a breakdown but rather a rebalancing, indicative of the cryptocurrency’s increasing acceptance by institutional investors.
Bitcoin is now seen as a risk asset instead of a revolutionary concept.
“The October 10 flash crash wasn’t a failure of bitcoin,” Greenspan remarked in an interview. “It was a liquidity event, sparked by macro stress, trade-war concerns, and crowded positioning, revealing how forward-loaded the cycle had become.”
This abrupt behavioral shift made forecasting nearly impossible and caused some of the most well-known analysts in the sector to rethink their positions.
Read more: In 2025, bitcoin demonstrated how dramatically off-base price forecasts can be
As the year commenced, specialists like Matt Hougan, chief investment officer of Bitwise Asset Management, Mike Novogratz, CEO of Galaxy Digital, and Geoffrey Kendrick, global head of digital assets research at Standard Chartered, shared optimistic views. However, as the year concludes, the reality appears markedly different.
‘Cautious capital’
What transpired? In simple terms, bitcoin’s ideological roots were overshadowed by its growing recognition as an institutional asset. This evolution altered how sophisticated investors from traditional markets traded and assessed bitcoin.
‘What went amiss in 2025 is that bitcoin subtly crossed a threshold. It transitioned from being a niche, retail-driven asset to becoming part of the institutional macro landscape,” Quantum Economics’ Greenspan conveyed to CoinDesk. “Once Wall Street entered the picture, bitcoin began to trade less on ideology and more on liquidity, positioning, and policy.”
With Wall Street’s participation, bitcoin became more closely linked to macroeconomic trends affecting all asset categories. While it may still be promoted as a hedge against the Federal Reserve, it is now more reactive to Fed policy than ever before.
“Markets entered 2025 anticipating quicker, more profound Fed easing — which has not happened,” stated Jason Fernandes, co-founder of AdLunam. “BTC, like many other risk assets, is bearing the brunt of cautious capital.”
Moreover, the liquidation frenzy in October left both retail and institutional investors battered.
“Liquidations driven by derivatives led to a choppy, erratic market where one wave triggered the next,” Fernandes stated. “It’s unsurprising that ETF inflows dwindled.”
From January to October, U.S. spot bitcoin ETFs garnered about $9.2 billion in net inflows, approximately $230 million each week. Yet the momentum abruptly shifted. From October to December, the numbers turned negative, with over $1.3 billion in net outflows, including a $650 million withdrawal in just four days in late December.
Quantum Economics’ Greenspan highlighted a fundamental catch-22: “Bitcoin is often presented as a hedge against the Federal Reserve, yet in practice, it remains reliant on Fed-driven liquidity.’” Since 2022, the Fed has been gradually withdrawing liquidity from the system, which ultimately flows into risk assets, including bitcoin.
“When that liquidity diminishes, the upside becomes fragile,” he added.
Skewed expectations
This altered reality poses a dilemma for bitcoin and the entire crypto landscape. For widespread adoption and price surges, Wall Street’s capital is essential, yet that capital can be a double-edged sword.
“Most assumed that institutional acceptance would propel bitcoin to a million [dollars] in the blink of an eye,” remarked Kevin Murcko, CEO of the crypto exchange CoinMetro. “However, now that it’s entrenched in the institutional sphere, it’s being treated like any other Wall Street asset.
“This means it reacts to fundamentals, not solely belief,” he continued. “We’re witnessing prices responding to everything from the Bank of Japan (BOJ) ending cheap capital to political uncertainties surrounding the Fed itself. And institutions dislike uncertainty.”
Weekends present another challenge.
“Bitcoin operates 24/7, but capital flows do not; most significant flows occur Monday through Friday. Thus, when the weekend approaches, and leverage is intense, cascading liquidations occur.”
Silver lining
Nevertheless, this doesn’t imply it’s all pessimistic. In fact, experts believe it’s a positive shift toward higher prices, albeit slower than anticipated.
Bitwise’s Hougan maintains a bullish outlook on the general trajectory: “It’ll be tumultuous. However, the macro direction is evident.
“The market is influenced by the clash of strong, enduring positive forces and periodic, violent negative ones.” He remains hopeful despite the recent shakeouts. “Institutional uptake, regulatory clarity, macro anxieties about fiat devaluation, and practical use cases like stablecoins are all gradual, optimistic forces. They require a decade to fully materialize.”
Historically, bitcoin has been linked to a four-year cycle corresponding to the regular 50% reduction in the generation of new tokens awarded to miners, but 2026 could introduce a new dynamic, he added.
“The traditional cycle influences — halvings, interest rates, and leverage — are significantly weakened,” he informed CoinDesk earlier this month. Future growth is set to be driven by more mature, structural forces, such as institutional inflows, regulatory transparency, and global asset diversification. “That’s why we anticipate that bitcoin could achieve new all-time highs in 2026 — even beyond the conventional halving cycle.”
Quantum Economics’ Greenspan succinctly encapsulates the current state and future of bitcoin.
“This wasn’t ‘peak bitcoin,’” he stated. “It marked the point when bitcoin officially began to engage in Wall Street’s arena.”
