Among the most vocal skeptics is Michael Burry, a hedge fund manager who gained world fame after predicting the collapse of the American real estate market in 2007 and making millions from it.
Burry has never hidden that he does not believe in cryptocurrencies. He has repeatedly called Bitcoin worthless, and previously described the $100,000 price as “the most ridiculous thing” he’s ever seen. Current events, according to him, confirm his views, and he warns that the so-called “death spiral” has begun.
According to available data, the reversal began at the beginning of October 2025, when bitcoin, just a few days after reaching an all-time high of around $126,000, experienced a sharp decline. During the so-called “Black Friday”, the price fell by a double-digit percentage in just a few hours, and the new customs threats of US President Donald Trump against China were cited as the trigger.
From that moment on, there was no recovery. Last week, the price of bitcoin briefly dipped to around $60,000, almost completely erasing the gains made since the fall of 2024. It is estimated that almost two trillion dollars in market value disappeared from the crypto market, while investors were forced to liquidate assets worth about 150 billion dollars due to leveraged trading.
Long-term comparisons do not favor bitcoin either. Investing in the German DAX index over the past five years would have yielded a significantly higher return, by more than 30 percentage points.
A special paradox is the fact that the price drop is taking place in a political environment that, at least in the US, is extremely favorable to the crypto sector. Donald Trump’s administration has pushed through a series of cryptocurrency-friendly laws, reformed the SEC, and introduced a sovereign bitcoin reserve. Despite this, the market shows no signs of confidence.
Even bitcoin ETFs, which were considered a major breakthrough, did not bring the expected inflow of institutional capital. Most of the invested funds still come from small investors, while professional investors are much more cautious.
Analysts warn that bitcoin is losing a key element of any currency – trust. Although it is unlikely that its value will fall to zero, the basic narratives of “digital gold” and protection against inflation are increasingly being questioned.
Technical analysis further reinforces the concern. A “head and shoulders” pattern has been observed on the charts, which in the past has proven to be a signal for a strong price decline. According to estimates, the first important support zone is around $49,000, and in a pessimistic scenario, even a possible drop towards $21,000 is mentioned.
Most affected are short-term investors who entered the market in the last few months and are now in a significant red. Additional risk comes from companies that have aggressively bought bitcoin with the help of debt, as possible bankruptcies could trigger a new wave of forced sales.
However, part of the crypto community still believes that this is an opportunity to buy during the downturn, citing historical examples where investing in moments of panic paid off in the long run. Whether such a scenario repeats itself will depend on whether bitcoin manages to regain market confidence and offer a new, compelling growth story.
(Vijesti.ba)
