In 2025, Bitcoin's price in USD crashes, a shocking shift from its peak to annual losses

The past year has undoubtedly been a heavy test for cryptocurrency holders. Bitcoin’s price in USD once reached a historic high of $126,251, but then plunged into a deep correction, ending the year at around $87,000. This shift not only means that more than 30% of the gains have been completely wiped out but also creates a rare annual negative return record since 2014—-a -6.3% annual return. Behind this market turbulence reflects shaken investor confidence and the deep risks hidden within the market structure.

Bitcoin Falls from $126,000 Peak to Year-End, Record Drop in USD Price

As the leader of the cryptocurrency market, Bitcoin’s performance serves as the best window into overall market sentiment. On October 6, Bitcoin’s USD price hit a new high of $126,251, with market participants cheering and seemingly on the verge of a new bull market. However, just a few months later, Bitcoin experienced a staggering decline. By the end of 2025, Bitcoin’s USD price had fallen to $87,000, turning the year’s overall performance negative. This high-to-low trend not only shattered the optimism of early-year believers but also revealed a huge gap between expectations and reality in the market.

October Crisis: Leverage Liquidations Trigger $19 Billion in Cleared Positions

The market turning point occurred on October 11, when U.S. President Trump threatened to impose additional tariffs on China. This geopolitical shock triggered a chain reaction. Bitcoin’s USD price plummeted over $10,000 in an instant, with a nearly 10% daily drop, almost breaking the $100,000 mark. This “flash crash” event within 24 hours triggered over $19 billion in leveraged position liquidations, setting a new record for single-day liquidation scale in cryptocurrency history, with more than 16,000 trading accounts completely wiped out during this turbulence.

Over-leverage was the fundamental driver of this crisis. On the eve of the crash, open interest in futures markets reached a historic high. Open contracts for Bitcoin and Solana increased by 374% and 205% respectively since the beginning of the year, planting explosive risk factors in the market. Highly leveraged traders suffered massive losses, accelerating the sell-off and creating a domino effect spiral downward, ultimately pushing the fragile market structure toward collapse.

Optimistic Predictions Turn False, Market Sentiment Shifts from Bullish to Bearish

At the start of the year, under the influence of the Trump administration’s pro-cryptocurrency policies, the entire market was filled with optimism. Institutional capital flooded in, and industry insiders made a series of aggressive forecasts. Jan3 CEO predicted Bitcoin would surge to $1 million by year-end, and in early October, JPMorgan analysts even raised their year-end target to $165,000. These ambitious predictions once fueled investor enthusiasm, but ultimately all remained just dreams. The huge gap between actual results and expectations deeply reflected the misjudgment of the market and exposed the fragility of market liquidity and leverage buildup.

During the market correction, the total market cap of cryptocurrencies rapidly declined from $3.26 trillion to $2.93 trillion in October, evaporating about $330 billion within a few weeks, a 10% drop. Institutional investors began to withdraw, ETF capital inflow momentum weakened, and macroeconomic factors lacked catalysts for growth, further undermining the market’s bottom support.

Gold and Silver Make a Comeback, Cryptocurrencies Fade

Contrasting sharply with the plight of cryptocurrencies, the traditional precious metals market showed a different picture. In 2025, spot gold achieved an astonishing 64% annual increase, marking the strongest yearly performance since 1979 and becoming a true safe haven. Spot silver performed even better, soaring 147%, and once breaking the historical high of $84 per ounce. Bitcoin, once dubbed “digital gold,” has faded into the background, not only losing to physical precious metals but also underperforming the US stock market. In 2025, the US stock market’s market value is expected to increase by over $9 trillion, indicating that market optimism about the US economy remains. Only the cryptocurrency market has entered a typical bear cycle, with a sharp decline in investor risk appetite evident.

The end of this year is undoubtedly a profound lesson for those once full of hope in crypto assets. The market experienced a complete breakdown of confidence from optimism at the start of the year to collapse at year-end, revealing the dangerous game of leverage and expectations in the financial markets.