(MENAFN- Crypto Breaking) Bitcoin 's rally has hit a snag, with the cryptocurrency temporarily losing all its gains for the year amid a volatile weekend in crypto markets. Despite the U.S. government reopening after a lengthy shutdown, Bitcoin experienced a sharp decline before rebounding slightly. This turbulence underscores ongoing concerns about macroeconomic influences and the shifting behaviors of major investors within the crypto space.

• Bitcoin plunged to a low of $93,029 over the weekend, wiping out its gains for 2023 but has since started a modest recovery.
• Market volatility persists despite the U.S. government reopening after a record 43-day shutdown.
• Bitcoin whales and long-term holders are selling off, adding pressure on prices during late-stage bull market behavior.
• Ethereum and Solana have also declined, reflecting broader declines across the cryptocurrency market.
• Industry analysts debate the integrity of the four-year cycle theory amidst growing institutional and regulatory support.

Bitcoin (BTC ) dropped sharply over the weekend, reaching a low of $93,029, marking a 25% decline from its October all-time high and erasing all of its gains for 2023. Although it has since recovered to approximately $94,209, the sudden shift highlights ongoing market volatility, even amid positive macroeconomic signals.

Market sentiment was initially optimistic following the US government's reopening, which ended a historic shutdown of 43 days. The political and economic uncertainty, however, continues to cast a shadow on the crypto markets, with Bitcoin struggling to maintain its recent momentum.

Bitcoin's price information, including the change in price since Jan. 1, 2025. Source: CoinGecko

This year was heavily driven by hopes for a bullish crypto market, propelled by the formation of a more pro-cryptocurrency U.S. administration under President Donald Trump, which promised to streamline regulations and foster institutional adoption. Increased corporate treasury allocations to Bitcoin and heightened inflows into spot Bitcoin ETFs bolstered this outlook. Nevertheless, geopolitical tensions, inflation concerns, and regulatory uncertainties have offset these gains.

Key events such as the escalation of tariffs and the US government shutdown have triggered multiple sharp declines, demonstrating that market confidence remains fragile. Despite these setbacks, Bitcoin's resilience has been notable, with persistent interest from institutional investors, even as major whales have begun to sell off portions of their holdings, contributing to the recent downturn.

Bitcoin whales have also slowed price rallies

Despite industry optimism, large-scale holders-often termed“whales”-have been reducing their positions, a behavior that typically signals late-stage profit-taking rather than signs of panic selling. Analysts from Glassnode pointed out that long-term investors are engaging in routine market behavior rather than a sudden exodus, emphasizing that profit-taking in late bull markets is common.

Meanwhile, Ethereum (ETH ) and Solana (SOL ) have also seen significant declines of 7.95% and 28.3%, respectively, highlighting a broader risk-off sentiment across crypto markets and the struggles faced by altcoins in the current environment.

Four-year cycle thesis still not in effect, analyst says

Debate remains among industry analysts regarding the relevance of the four-year Bitcoin cycle theory, especially as institutional support grows and regulatory frameworks evolve. While some experts, like Bitwise CIO Matt Hougan, believe in a 2026 bull run driven by“debasement trade” fundamentals, others remain cautious.

Hougan emphasized the strength of underlying market fundamentals, suggesting that increased adoption of stablecoins, tokenization, and decentralized finance (DeFi) will position the market for a substantial rebound in the coming years.

As the crypto market navigates this turbulent phase, investors are closely watching regulatory developments, institutional moves, and macroeconomic trends that will likely shape the next bull cycle.

Crypto Investing Risk Warning
Crypto assets are highly volatile. Your capital is at risk. Don't invest unless you're prepared to lose all the money you invest.

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