Bellwether Bitcoin skilled a drawdown of 36 per cent from its peak of $126,198 on October 6 to a low of $80,660 on November 21, wiping out almost $700 billion of traders’ wealth.
The world of cryptocurrencies is reeling from an enormous $1.16 trillion wealth erosion over the previous 50 days. Bellwether Bitcoin skilled a drawdown of 36 per cent from its peak of $126,198 on October 6 to a low of $80,660 on November 21, wiping out almost $700 billion of investor wealth.
This tally of $1.16 trillion contains over a trillion {dollars} in worth misplaced by prime 10 cryptocurrencies and a couple of hundred billion in market-cap misplaced by a handful of crypto shares akin to Technique Inc. of the US (Technique, in brief; previously generally known as MicroStrategy Inc).
Technique’s shares are down 67 per cent from the all-time excessive recorded in November 2024, reminding traders of how the inventory crashed 95 per cent throughout the dotcom bubble.
Bitcoin has recovered over the week, on the expectation of a fee lower and a doable restart of bond purchases by the US Federal Reserve in its December coverage, per consultants. Hopes of the speed lower and a resultant gush of liquidity appear to have helped Bitcoin discover its backside. The irony right here is that it’s the similar liquidity or extra cash provide that it got down to battle with its restricted 21 million float, is holding it afloat. It now trades at $90,915 or down about 28 per cent from its October peak.
Different main cryptocurrencies, too, continued to tumble triggered by Bitcoin (see graphic).
Rout in crypto shares
Crypto shares, too, have misplaced as a lot. Shares of Bitcoin treasury firms (an organization that invests and holds Bitcoin as a part of its monetary property) akin to Technique and Metaplanet (Japan) are down 51 per cent and 35 per cent, respectively. Bitcoin miners MARA Holdings and Riot Platforms are down 43 per cent and 25 per cent. Crypto exchanges Coinbase and Bullish have seen losses of 29 per cent and 37 per cent.
Technique Inc, ETFs
Ever for the reason that US authorities gave the go forward for spot Bitcoin ETFs in January 2024, the market has been flooded with crypto ETFs. These not solely embrace spot ETFs but in addition leveraged ETFs which are merely devices of mass hypothesis. A leveraged ETF borrows cash aside from traders’ funds to commerce in cryptos. Funds that search to ship twice the each day returns of spot Bitcoin are the most well-liked. Twice the returns, twice the drawdowns too!
These aside, there are additionally leveraged ETFs which are uncovered to Technique, which in flip is a levered agency uncovered to Bitcoin. These have extra layers (of leverage) than your common pastry!
Now, what’s so particular about Technique that there are ETFs monitoring its inventory? Technique is actually an information analytics firm that reworked right into a Bitcoin treasury firm in 2020. It raises funds, each debt and fairness, in opposition to the collateral of Bitcoins. With these funds, it buys Bitcoin and bets on the long-term appreciation of the crypto. It now has 6.4 lakh Bitcoins or about 3.1 per cent of all the Bitcoin float (about 20 million) at a median worth of $74,000 (as of Q3 2025).
Nonetheless, the mannequin hinges on an unrealistic assumption that Bitcoin returns can constantly beat traders’ anticipated fee of returns. Volatility in Bitcoin costs rock Technique’s shares, too. As an illustration, the market-cap to Bitcoin NAV ratio, which was about 1.7x in July 2024, is now 1.1x. This might worsen when MSCI takes a choice to exclude firms with over 50 per cent of property invested in digital property (Technique is one such firm), from its indices, in January.
MSTU and MSTX are two giant leveraged ETFs that goal to ship twice the each day returns of Technique’s shares. The mixed AUM of those ETFs was about $4.7 billion in December 2024. Now they’ve been lowered to be price simply $831 million. Crypto ETFs, along with such leveraged ones, have eradicated $72 billion of traders’ wealth since Bitcoin’s peak in October.
Gold: The true hedge
All these carry up the query: What goal do cryptos like Bitcoin serve? Are they a retailer of worth or are they a hedge in opposition to inflation?
With such volatility, can they actually be a retailer of worth? With such drawdowns and inflation nonetheless not reined in, have they protected traders? Apparently not. And they’re nowhere near changing into authorized tender.
Then again, gold has executed the precise reverse. In greenback phrases, gold has returned 62 per cent year-to-date, whereas Bitcoin has delivered a detrimental 2.7 per cent.
What’s baffling is that gold, valued at about $32 trillion globally, has attracted $43 billion of web flows into US gold ETFs, up to now in 2025. In the meantime, cryptos that are a $3-trillion asset (per CoinMarketCap), have attracted flows of an equal $44 billion into crypto ETFs traded on US exchanges. Makes one query the sanity of crypto bulls.
Final yr similar time, we had posed the query whether or not Bitcoin is a foreign money, retailer of worth or a funds innovation. A yr therefore and after 16 years of Bitcoin, the query stays.
On this backdrop, India’s stance on cryptos stands in stark distinction.
Revealed on November 29, 2025
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