The dramatic sell-off in cryptocurrency markets has delivered a severe blow to companies that made substantial bets on Bitcoin, with the digital asset losing half its value in just three months. This sharp decline has exacerbated broader stock market anxieties, highlighting the volatile nature of crypto investments.
A Steep Decline from Record Highs
Bitcoin's price plummeted to $63,000 on Thursday, marking its lowest point in over a year and representing a staggering 50% drop from its all-time peak of $126,000, which was achieved in October 2025. According to data from Coinbase, the world's most prominent cryptocurrency first breached the $100,000 threshold in December 2024 and soared to a record high of $126,210.50 on 6 October last year.
The currency enjoyed a sustained bull run during Donald Trump's ascent to the presidency in 2024 and throughout 2025, buoyed by a series of industry-friendly policies. However, this upward trajectory has reversed sharply over recent months, with particularly steep falls recorded in January and early February.
Corporate Portfolios Under Pressure
Firms that allocated significant portions of their treasury or investment portfolios to Bitcoin have borne the brunt of this downturn. CoinGecko reports indicate that the global cryptocurrency market has shed an astonishing $2 trillion in value since the beginning of October.
Several publicly-listed cryptocurrency ventures with backing from the Trump family have seen their market valuations decline in tandem with Bitcoin's slump. This correlation underscores the heightened risk exposure for businesses intertwined with digital asset markets.
Broader Crypto Market Struggles
Bitcoin, originally conceived in the wake of the 2008 financial crisis as a decentralised alternative to traditional banking, remains the most valuable cryptocurrency globally. Yet its struggles are mirrored across the sector.
Ether, the second-largest cryptocurrency by market capitalisation, has suffered losses exceeding 30% this year alone. This decline is particularly notable given that Ether largely missed out on the dramatic boom period witnessed in 2025, compounding challenges for its investors.
Regulatory Scrutiny Intensifies
Beyond financial turmoil, the cryptocurrency industry is facing mounting regulatory pressures. In the United States, some Democratic lawmakers and watchdog groups have expressed concerns about potential conflicts of interest surrounding cryptocurrencies under the current administration and the perceived lack of robust regulatory frameworks.
US Representative Ro Khanna announced on Wednesday his intention to investigate World Liberty Financial. This move follows Wall Street Journal reports detailing a $500 million investment from a member of the Emirati royal family into a cryptocurrency company associated with the Trump family.
In a formal statement, Khanna suggested that the reported deal "may have contributed to changes to US policy", indicating that political and regulatory examinations are likely to intensify alongside the market's financial volatility.
The confluence of a severe market correction and growing political scrutiny presents a formidable challenge for corporations and investors who placed significant faith in Bitcoin's continued ascent, serving as a stark reminder of the asset's inherent unpredictability.
