Despite numerous positive developments throughout 2025, cryptocurrency markets are struggling to gain momentum, leaving analysts and investors puzzled about the disconnect between favorable conditions and price performance.

The Puzzle

CNBC crypto contributor Ran Neuner highlighted the contradiction this week, noting that crypto should be thriving given several strong tailwinds: abundant liquidity, a supportive US administration, successful ETF launches, significant institutional investment, active corporate treasury buying, and robust performance in traditional assets like gold and equities.

Yet the numbers tell a different story. The total crypto market capitalization has dropped more than 32% from its October peak of $4.4 trillion and sits nearly 13% below where it started the year.

Two Scenarios Ahead

Neuner outlined two potential paths forward: either the market identifies what’s fundamentally wrong and who’s driving the selling pressure, or crypto experiences a massive catch-up rally as market dynamics eventually normalize.

Economist Adam Kobeissi suggested that future analysis will reveal crypto is undergoing a structural transformation driven by unprecedented leverage levels, with recent weeks marked by frequent large-scale liquidations.

Analyst PlanB characterized the situation as a standoff between buyers and persistent sellers, including early investors scarred by 2021’s downturn, technical traders watching indicators, and those anticipating a cyclical bear market.

Is Winter Already Here?

Some experts believe the bear market has already begun. Markus Thielen of 10x Research told Cointelegraph that Bitcoin entered bearish territory in late October, becoming the first major risk asset to reflect economic slowdown concerns. He noted that retail participation never meaningfully recovered during this cycle, with value creation concentrated narrowly in Bitcoin rather than spreading across the sector.

The Bright Side

Despite disappointing price action, the industry’s underlying fundamentals remain strong. Erik Lowe from blockchain venture firm Pantera emphasized in a recent report that 2025 delivered unprecedented structural progress, including regulatory shifts at US agencies, establishment of strategic Bitcoin reserves, and growth in stablecoins and tokenized real-world assets.

From that perspective, this may be the most significant year in crypto’s history—one focused on building the foundation for sustainable long-term growth rather than speculative price appreciation.