Bitcoin Revisited | Following Weak Performance in Q4 2025
BTC went down from historic highs near $126k and settled in a range below $90k. Interestingly, BTC corrected while other risk assets were holding up fine, particularly the Nasdaq 100. Gold, the competing debasement hedge to BTC was also setting all-time highs. There are several narratives that could explain this sudden deviation in the strength of BTC and its response to global liquidity and risk appetite:
1) Changes in ownership with almost half of circulating supply moving from foundational crypto “Whales” to mainstream institutional holders. BTC did go mainstream. Institutional buyers employ what borders on market manipulation to create suitable conditions for accumulation of a new long-term asset. This is very similar to the price suppression that recently gave way in gold in silver.
2) Bitcoin did lose some of its mystique as a decentralized asset with valuable network effect due to this evolution. Did that degrade its utility or is this a temporary setback that is almost over?
3) Perhaps the utility and inevitability of BTC was over-hyped a bit? When nearly everyone says something must go up, it rarely does so without a few painful surprises along the way. The perma-bull sentiment has evaporated - that be more beneficial for BTC in the long run if this “store of value” use-case of BTC remains valid.
In short, BTC has had large price swings throughout its life. Most of the money is made from buying it when most others don’t want to. Most money has been lost from jumping on the bandwagon late in a rally. My positive view on the case for Bitcoin remains intact, and I would be adding modestly to portfolios that do not hold any yet. Also looking for price action to support that institutional accumulation is done and this new group of holders is ready to let the price rise again.
Disclosures
All written content is for information purposes only. It is not intended to provide any tax or legal advice or provide the basis for any financial decisions. Material presented is believed to be from reliable sources; however, we make no representations as to its accuracy or completeness. All information and ideas should be discussed in detail with your individual adviser prior to implementation. Advisory services are offered through GenSphere Private Wealth, LLC, a Registered Investment Advisor in the State of Washington. Being registered as a registered investment adviser does not imply a certain level of skill or training. All investing involves risk including loss of principal. Past performance does not guarantee future results.