Bitcoin posts annual decline for the first time in three years…after hitting a record high in early October, it plunged

Leverage unwound, triggering a record $19 billion in liquidations

Bitcoin, the largest cryptocurrency by market capitalization, ended 2025’s “roller-coaster” trading with an annual loss for the first time in three years.

According to Coinbase, a U.S. cryptocurrency exchange, as of 5 p.m. Eastern Time on the 31st, one bitcoin was priced at $87,646. It was trading around that level, down about 7% from the start of the year.

As a result, unless there is a notable rebound later in the evening, bitcoin will turn negative on the year for the first time in three years. Bitcoin had posted gains for the past two years since 2022.

This year, bitcoin saw extreme volatility, simultaneously setting a new record high and recording the largest liquidation on record. Buoyed by expectations for U.S. President Donald Trump’s pro-crypto policies—after he billed himself as a “crypto president”—bitcoin started the year on an upswing. But in April, when President Trump opened what he called a “tariff war” against the world, it plunged alongside equity markets.

Later, sentiment improved across the crypto market, including bitcoin, after the so-called GENIUS Act—legislation to bring dollar-pegged stablecoins (value-stabilized digital assets) into the regulatory fold—was enacted. Bitcoin also managed a rebound.

As the rally extended into early October, bitcoin hit $126,210 on Oct. 6, setting a new all-time high.

However, just days after the record, on Oct. 10, President Trump announced 100% tariffs on imports from China and said export controls would also be imposed on key software, freezing markets again.

In the process, leveraged positions funded with borrowed money were forcibly unwound, sparking liquidations totaling $19 billion (about 27.4 trillion won), the largest in cryptocurrency history.

Investors’ expectations for an October “Uptober” rally and a November “Moonvember” surge were dashed in succession. November in particular logged the steepest monthly decline since mid-2021.

Experts say bitcoin this year cemented its identity in global financial markets as a risk asset akin to equities. Linh Tran, chief market analyst at XS.com, told Reuters that “2025 was a year when bitcoin’s risk-asset characteristics became even more pronounced,” adding that it “showed a high correlation with the U.S. stock market over multiple periods.”

The implication is that bitcoin—once dubbed “digital gold” and seen as an alternative investment that moved independently of stocks—is increasingly mirroring equity-market sentiment amid heavy inflows from institutional and retail investors. Analysts expect bitcoin to remain sensitive next year to key equity-market drivers such as monetary policy and debates over an artificial intelligence (AI) bubble.

Park Subin, Hankyung.com reporter waterbean@hankyung.com