Bitcoin fell sharply on Monday, dropping more than 5 per cent and slipping below the US$90,000 mark as a broader risk-off mood swept global markets. By midday (1120 GMT), the world’s largest cryptocurrency was trading around $86,461 — down 5.2 per cent and on track for its biggest one-day loss in a month. At one point, Bitcoin plunged as much as 6.1 per cent, edging close to last month’s eight-month low of $80,553.
The decline follows a brutal November in which Bitcoin shed over $18,000 in value, its steepest dollar loss since May 2021 — the month that saw a major collapse across several cryptocurrencies. Analysts say sentiment has become increasingly fragile, with investors fleeing riskier assets amid uncertainties heading into year-end.
Although Bitcoin has historically performed well in December — averaging a nearly 10 per cent gain — analysts note that traditional seasonality offers little reassurance given its tight correlation with stocks. Kathleen Brooks of XTB Research said Bitcoin is currently acting as a “leading indicator of risk sentiment,” and Monday’s slide does not bode well for equity markets. She added that a sharp drop in volatility last week, with the VIX falling below its 12-month average, may have spooked investors already cautious about the economic outlook.
Futures markets also reflect growing pessimism. CME Bitcoin futures expiring in three months are trading at their smallest premium to near-term contracts in at least a year, signalling that traders see limited upside ahead.
Other cryptocurrencies faced heavy losses as well. Ether fell nearly 6 per cent to $2,845 after shedding 22 per cent in November — its worst month since February’s 32 per cent plunge.
Several negative developments have compounded the pressure. S&P Global downgraded its rating of Tether, the world’s largest stablecoin, citing higher-risk reserves and continued transparency concerns — an assessment that Tether vigorously disputes. Meanwhile, Strategy (formerly MicroStrategy), the largest corporate holder of Bitcoin, signaled it could sell some of its holdings if its internal metric, mNAV (enterprise value vs. Bitcoin value), drops below 1. The ratio currently sits at 1.19.
Shares of crypto-exposed companies — including Strategy, Coinbase, Riot Platforms, and MARA Holdings — fell 3 to 4 per cent in premarket trading. A deeper concern for Strategy is the possibility of being removed from key benchmark indices after its 60 per cent share-price decline over the past year, far worse than Bitcoin’s 13 per cent drop in the same period. Index provider MSCI is currently reviewing whether companies with more than 50 per cent of assets in digital holdings should be excluded from major benchmarks.
The overall crypto market has now lost more than $1 trillion in value since peaking at around $4.3 trillion, according to CoinGecko — highlighting the mounting headwinds facing digital assets as 2025 draws to a close.