Bitcoin on track for its second-worst Q4 ever after heavy losses

Bitcoin, the leading cryptocurrency, is set to record its second-worst fourth quarter in history. It has only performed worse during the brutal 2018 crypto winter. While the gap between the worst year (2018) and 2025 is significant, 2025 still falls far deeper than other bad years (2014, 2019, 2022), pushing it from a “mild correction” into full “crash” territory.

Historically, Q4 is Bitcoin’s strongest quarter, with an average return of 77%. Investors often rely on it to salvage their portfolio’s annual performance.

However, with nearly a 23% drop, Bitcoin has underperformed its historical average by almost 100 percentage points, turning an expected +77% into a realized -23%. Instead of the usual December “gifts” for Bitcoin holders—such as +479% in 2013 or +168% in 2020—investors are facing heavy losses. The year began poorly and is ending even worse. This is psychologically taxing, as mid-year gains (Q2) have largely been erased by Q4 losses. Ending the year with a crash demoralizes investors and reinforces the perception that the asset class is in a long-term downtrend.

Why has Q4 been so terrible?

Bitcoin started Q4 strong, reaching a new all-time high around $126,000 in early October. However, it quickly turned downward.

According to a December 2025 CryptoQuant report, the main reason for the crash is “demand exhaustion.” Key groups that drove the 2024–2025 rally—spot ETF buyers, corporate treasuries, and others—have stopped buying. Additionally, reports show whales exiting the market. Expectations of a year-end rally trapped many traders who bought in November.