Published: December 23, 2025
Bitcoin has endured a challenging end to 2025, trading around $87,500 after peaking above $126,000 earlier in the year. The cryptocurrency is down more than 22% in the fourth quarter alone—its steepest quarterly decline since the 2018 bear market—amid fading momentum and heightened year-end pressures.
Bitcoin’s Q4 2025 Performance: A Sharp Reversal
As of December 23, Bitcoin sits approximately **30%** below its all-time high of $126,198 reached in October. The Q4 drop exceeds 22%, driven by a combination of factors:
- Weakening institutional inflows and retail caution.
- Macroeconomic uncertainty and risk-off sentiment in broader markets.
- A massive **$23 billion** Bitcoin options expiry scheduled for late December, amplifying volatility and positioning pressures.
This expiry—the largest on record—has contributed to choppy price action, with heavy put interest near $85,000 potentially acting as a downside magnet.
Historical Context: Echoes of Past Downturns
Q4 has historically been one of Bitcoin’s strongest periods, often delivering rallies. However, 2025’s performance stands out negatively:
- The only comparable Q4 weakness occurred in 2018, when Bitcoin lost over 42% amid a prolonged crypto winter.
- Unlike major crashes, this decline follows a year of institutional progress and ETF growth, making it unique.
- Year-to-date returns have flattened or turned slightly negative, contrasting earlier optimism.
Analysts note that while drawdowns of 20-30% are normal in bull cycles, the timing and options-driven dynamics add layers of complexity.
Impact of the $23 Billion Options Expiry
The upcoming expiry concentrates risk:
- Dealers unwinding hedges could trigger sharp moves post-settlement.
- Bearish skew in positioning suggests traders are bracing for further downside.
- Historical large expiries often lead to volatility spikes, especially in thin holiday liquidity.
Implications for Investors
This environment presents both challenges and considerations:
- Short-term traders: Face elevated volatility risks; strict risk management and monitoring of key levels ($85,000 support, $90,000 resistance) are essential.
- Long-term holders: May view corrections as healthy in maturing cycles, with historical patterns showing recoveries after similar quarters.
- Opportunities: Potential for capitulation to mark bottoms, followed by repositioning into 2026.
- Risks: Prolonged weakness if macro pressures persist or selling accelerates.
Diversification and patience remain key in navigating late-cycle dynamics.
Conclusion: A Testing End to 2025
Bitcoin’s over 22% Q4 decline—the worst since 2018—combined with the looming $23 billion options expiry, underscores a period of fatigue after earlier highs. While short-term uncertainty looms, the asset’s fundamentals continue evolving. Investors should stay vigilant, tracking expiry outcomes, on-chain metrics, and broader market signals for clues on the next phase.
Ready to dive into crypto? Sign up on Tapbit today and kick off your trading journey in seconds.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrency markets are highly volatile. Always conduct your own research.
