Although bitcoin was setting a new all-time high around $125,000 as recently as October, the price of the world’s largest and most popular crypto asset is now down roughly 40% since those good times, hovering around $75,000. According to data from CoinMarketCap, the crypto market as a whole has seen $1.75 trillion whipped out since those October highs.
In terms of reasons for Bitcoin’s recent struggles, there has been a lot of discussion around its relative underperformance when compared to gold amidst various signs of global economic tension, as was seen during the contention around the status of Greenland. Bitcoin is oftentimes referred to as “digital gold” due to the view that it could potentially act as a safe haven asset in times of geopolitical uncertainty, much like the role its analog counterpart has had for thousands of years.
Notably, gold recently outperformed bitcoin over a five-year time period, which had never happened before. That said, the precious metal has been moving around with extreme volatility lately, sometimes seeing swings in its total valuation larger than bitcoin’s entire market cap in a single day. Additionally, the death of bitcoin’s digital gold narrative has been grossly exaggerated in the past, perhaps most notably in the aftermath of the March 2020 COVID crash.
quantum is not why the whale sold
novo didn’t connect the two. he said it was one reason ppl are claiming for btc weakness, but he disagrees with that (this is clear if you read the full transcript)
he then clarified on bloomberg that quantum isn’t the reason for btc weakness https://t.co/pxvqOvsTZZ pic.twitter.com/JT5Qi0PXI4
— Alex Thorn (@intangiblecoins) February 3, 2026
Bitcoin also has its own micro concerns that are unrelated to the greater macro economy. Quantum computing has been brought up by notable investors, such as Ray Dalio and Jan Van Eck, as a key area of concern for Bitcoin’s security, and researchers from crypto firm Grayscale recently pointed to this issue as a reason for the recent underperformance. That said, the quantum issue for Bitcoin is not an imminent threat, and a variety of entities are conducting research and working on upgrades for the crypto network to make its cryptographic signatures resistant to the quantum threat.
There was also a recent setback in terms of the potential passage of the CLARITY Act, as Coinbase pulled its support for a draft version of the bill intended to provide regulatory clarity for the industry. It’s now less clear that regulatory clarity for the crypto market will come this year, although a report from crypto firm Galaxy indicates it may be more relevant to altcoins than bitcoin itself.
It’s also important to remember that bitcoin had already been on quite a run from the lows below $20,000 seen around the time now-defunct crypto exchange FTX filed for bankruptcy in November 2022.
At the end of the day, the reality is it’s still early days for bitcoin in terms of its institutional adoption as an alternative to gold. Central banks still very much prefer analog gold over digital gold, and the clearest indication of how far bitcoin still has to go in those circles may have been when Governor of the Bank of France François Villeroy de Galhau revealed that he did not even know there is no central issuer of bitcoin at the World Economic Forum in Davos recently.
That said, the Czech National Bank pushed back on the notion that no European central bank would ever hold bitcoin in its reserves with a pilot program that involved a purchase of $1 million worth of bitcoin.
It has been somewhat difficult for me to track Tom Lee’s Ethereum treasury company because he blocked me back when he was supporting Craig Wright’s fake Satoshi Bitcoin SV (BSV) scheme.
It seems to be going even worse than I predicted so far. I thought the “stablecoins are the… https://t.co/FU98fLwdDQ
— Kyle Torpey (@kyletorpey) February 4, 2026
Outside of bitcoin, digital asset treasury (DAT) company Bitmine is currently getting roasted on X, as the massive holder of Ethereum’s underlying ether crypto asset is now sitting on roughly $6.6 billion in unrealized losses associated with its purchases. Bitmine’s Tom Lee spoke about stablecoins as a Chat GPT moment for Ethereum around the time the DAT was launched; however, stablecoin issuers also launched their own “stablechains” last year in an effort to sidestep Ethereum and gain more control over the entirety of their tech stacks.
Strategy, which was the originator of the digital asset treasury company concept (with bitcoin specifically), has now also dipped slightly below its breakeven point with its bitcoin holdings, despite beginning its purchases all the way back in 2020. The company booked $17 billion in unrealized losses in Q4 2025.
The jury is still out on where bitcoin and the rest of the crypto market go from here, but a further drop in the bitcoin price could indicate that the four-year cycle associated with these assets is still intact, and this time is not different.
