Bitcoin’s price just keeps falling. And nobody seems to know where the bottom might be this time.
Bitcoin dipped to a low of $80,760 on Friday before recovering above $85,000, only to dip again. The price is currently $82,800 at the time of this writing, according to CoinMarketCap.
Zooming out, Bitcoin has had a brutal couple of months. It’s down 14% on the week, down 23.5% on the month, and down 34% since hitting an all-time high above $126,000 on Oct. 6. As Bloomberg notes, Bitcoin is on track to have its worst month since the crypto collapse of 2022.
What happened in 2022? That’s when Sam Bankman-Fried’s crypto empire, FTX, fell apart. SBF was using customer deposits at his crypto exchange to cover lost funds at his other company, Alameda Research. But the real reason it all fell apart was that SBF was dealing in fake money he created.
Binance CEO Changpeng Zhao bought a 20% interest in FTX in 2019. When SBF and Zhao had a falling out in 2021, SBF bought out his shares with a token that SBF had created called FTT—$2 billion worth of FTT. Zhao decided to cash out his FTT in 2022, knowing it wasn’t backed by anything, and it was the first domino to fall in what would be a messy fraud case for SBF.
SBF did a bunch of other illegal stuff, but he probably would’ve continued along just fine for years if Zhao hadn’t decided to essentially pull the rug out, knowing it would destroy his competitor’s empire. The point being that when you build a business on fake money, it’s incredibly vulnerable to a gentle push. SBF is currently in prison, and Zhao served five months in an unrelated case for violating anti-money laundering laws. Zhao, of course, was recently pardoned by President Donald Trump.
Which brings us to the price of crypto today and what it means for the industry more broadly. We’re already seeing crypto miners exit for more profitable AI endeavors, and crypto analytics firm DappRadar announced on Nov. 17 that it was shutting down for good. Are these the first signs of a proper collapse? Nobody knows for sure. But it definitely makes all those predictions about Bitcoin hitting $200,000 by the end of the year look silly.
Other crypto tokens have suffered right along with Bitcoin recently, though the picture there is more complex, given President Trump’s huge shift on crypto enforcement. Ethereum is down 31% on the month and 19% on the year. XRP (Ripple) is down 22% on the month, though it’s up 22% on the year because the price was suppressed by litigation from the SEC. The Trump administration, which is extremely friendly to crypto, given the president’s massive holdings, dropped the pressure on Ripple in August.
BNB, Binance’s coin, has also plunged recently, but is still up on the year after Trump’s SEC dropped a lawsuit against Binance in May. BNB is down 24% on the month but up 22% on the year. Solana is down 35% on the month and a whopping 51% on the year.
Bloomberg reports that $2 billion in leveraged crypto positions were liquidated in the past 24 hours alone. Will this be the bottom? If you know the answer to that with certainty in either direction, you could stand to make a lot of money. The problem is that nobody really knows.
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