The great crypto crash of 2025 entered a new phase on Wednesday, as Bitcoin plunged to its lowest level in seven months, extending the more than $1 trillion wipeout across the digital‑asset world.
The largest cryptocurrency fell to as low as $88,522 in New York trading, with the latest rout hitting investors big and small — from retail dip‑buyers to digital‑asset treasury firms whose stock premiums are vanishing. Token prices climbed from the lows late in the day after Nvidia gave a strong revenue forecast, helping counter concern that a global surge in AI spending is poised to fizzle.
The next psychological thresholds lie around $85,000 and $80,000, with the 2025 trough of $77,424 — set during April’s tariff‑related turbulence — in focus. The total market capitalization of cryptocurrencies peaked at about $4.3 trillion on Oct. 6 and now hovers near $3.2 trillion. Still much of that change reflects paper losses, not real‑world cash leaving hands.
Following a cascade of forced liquidations on October 10, when more than $19 billion of leveraged crypto positions were offloaded, the market’s fragility was exposed. That event triggered a chain reaction of margin calls, exchange-traded outflows and halted fresh buyer interest.
“Investors are stabbing in the dark a bit — they haven’t got any direction on macro, so all they can see is what on-chain whales are doing and they’re getting quite worried about it,” said James Butterfill, head of research at CoinShares.
Bitcoin’s surge to just north of $126,000 earlier in the year was based on twin pillars: expectations of multiple Federal Reserve interest‑rate cuts and growing institutional adoption. Both narratives have stalled while momentum buyers have beaten a retreat. The fall is dealing a heavy blow to digital‑asset treasury firms, whose valuations were built on the earlier rally.
Meanwhile, Ether dropped back below $3,000. After lagging Bitcoin during the first half of this year’s rally, Ether — the second-largest token — eventually rose to almost $5,000 in August to briefly clear its 2021 high. It has since relinquished those gains.
“I think we are closer to the end of the selling than the beginning, but markets are uncomfortable and crypto could have more downside here before it finds a base to recover from,” said Matthew Hougan, the San Francisco-based chief investment officer at Bitwise Asset Management.
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