Amid economic development, why does Bitcoin continue to test strength?

By the end of 2025, many crypto investors were expecting to see the “Trump rally” that would bring positive dynamics to the market. But the reality turned out to be far from expectations. Digital assets experienced a deep plunge in the past quarter, losing nearly $1 trillion in value throughout the year.

The sudden shift from optimism to fear

Earlier in the year, the cryptocurrency sector was full of hope. Bitcoin reached an all-time high of $126,080 on October 6, leading investors to believe that the big surge was just beginning. But just three weeks later, the landscape had completely changed.

When Trump announced a 100% tariff on China on October 12, global markets moved quickly. Within just 24 hours, $19 billion worth was liquidated in the cryptocurrency market—the largest liquidation event in history. This signaling showed how macroeconomic changes directly impact digital assets.

Multiple layers triggered the decline

According to Christian Catalini, founder of MIT Cryptoeconomics Lab, the market is not just following simple supply-demand dynamics. Three main structural factors combined to create perfect conditions for a market correction:

First, the $19 billion leverage cleanup that reached peak stress in October. Second, risk aversion caused by trade tensions between the United States and China. Third, the possible shift in how corporate balance sheets hold cryptocurrency assets.

Rachael Lucas, marketing and communications director of BTC Markets in Australia, shared an additional perspective: “Cryptocurrency is highly sensitive to global market sentiment and economic confidence. When investors are fearful, risky assets like crypto are the first to suffer.”

The impact of the AI sector on the crypto ecosystem

One aspect that many overlook is the connection between AI stocks and cryptocurrency mining. Many Bitcoin miners have diverted their energy infrastructure for data centers and AI operations. As Nvidia and other AI-related stocks declined, negative sentiment also spread to the crypto sector.

This situation demonstrates how interconnected different asset classes and industries are in the modern economy. Economic growth in one area can pose challenges to others.

Cryptoeconomic cycle versus long-term fundamentals

Despite all the pressure, Bitcoin remains above $91,150 according to the latest market data—a critical support level indicating market resilience. The “crypto winter” began in late 2021 and lasted until 2023, during which Bitcoin lost 70% of its value and institutions like FTX shut down.

“Technically, we are in a bear market,” says Lucas, “but the reality is that Bitcoin remains strong within structural cycles. It follows the long-observed four-year historical pattern that analysts have studied for a long time.”

The shift in investor mindset

The real change has occurred in how investors think about cryptocurrency as an asset class. More than ever, the market sees digital assets as responsive to macroeconomic indicators—from inflation rates to geopolitical tensions. It is no longer just an asset for risk-takers; it is part of a larger global financial ecosystem.

Economic development is not always linear, and the crypto market reflects deeper economic dynamics. While short-term volatility can be concerning, the long-term architecture of Bitcoin and blockchain technology continues to grow.

For those waiting for a “Trump rally” that did not happen as expected, the lesson is clear: in cryptocurrency, political sentiment matters, but macroeconomic fundamentals take precedence. The recovery will come, but not based on a single political event—it will result from the convergence of multiple positive indicators and the recovery of global economic confidence.