Bitcoin price slid roughly 16% last week, reviving memories of Crypto Winter. While there is no single smoking gun, parallels to past crashes—such as ICO-driven busts in 2018 and FTX’s 2022 collapse—underline how market sentiment can turn quickly, with around $200 billion in market cap evaporating in days. Analysts cite five possible drivers: alternative booming markets such as prediction markets, gold, silver, and AI stock investments; and supply dynamics from Bitcoin ETFs and derivatives that dilute scarcity. Regulatory delays, including conversations around the Clarity Act, and a hawkish tilt in Fed policy with Kevin Warsh named as a possible chair add to the headwinds.
Profit-taking after earlier rallies seen with a Trump-backed surge has also weighed on prices. The discourse remains divided. Some industry voices argue the sector has strengthened infrastructure and long-term growth, while Nouriel Roubini contends crypto lacks intrinsic value and is a centralization risk, calling it a Ponzi-like scheme. He says it fails to meet key functions of money such as a store of value, unit of account, and medium of exchange.
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