Bitcoin edged higher on Wednesday but remained on course to finish the year in negative territory. Heavy losses in the fourth quarter continued to weigh on prices, as thin holiday liquidity and fading risk appetite pressured the broader cryptocurrency market.
The world’s largest digital asset was last trading up 1.3% at around $89,010 by 06:56 ET. Despite the modest daily gain, Bitcoin was still facing a challenging year-end outlook.
Bitcoin was set to post an annual decline of nearly 5%, driven largely by a steep fourth-quarter drop of more than 22%. The late-year sell-off followed a record high above $126,000 reached in October, reversing much of the year’s earlier gains.
The sharp pullback left Bitcoin struggling to maintain key technical support levels, as investors reduced exposure to risk assets amid tightening financial conditions.
Bitcoin pressured after Q4 slump
Bitcoin’s late-2025 weakness came after a strong rally in late 2024, when prices surged following the election of U.S. President Donald Trump. At the time, markets anticipated a more supportive regulatory environment for digital assets, fueling optimism and strong inflows across the crypto sector.
That momentum carried into early 2025 but proved difficult to sustain. After posting solid gains in the first half of the year, Bitcoin began losing traction from mid-2025 as global financial conditions tightened and investor caution increased.
Efforts to stage a rebound in December failed to gain momentum, despite expectations for a seasonal Santa Claus rally. Prices repeatedly stalled at higher levels, with each bounce met by renewed selling as traders locked in profits or reduced positions ahead of year-end.
Institutional interest in digital assets remained present, including ongoing activity in spot Bitcoin exchange-traded funds. However, inflows were not sufficient to counter the broader risk-off mood across global markets.
Altcoins muted as annual losses loom
Elsewhere in the crypto market, most major altcoins remained range-bound on Wednesday and were also set to close the year lower.
Ethereum, the second-largest cryptocurrency, rose 0.8% to $2,996.10 but was still on track for a roughly 10% annual decline. XRP traded slightly higher at $1.87, also heading for a similar yearly loss.
Among other major tokens, Solana gained 2% on the day, while Cardano and Polygon were little changed.
Meme coins also showed limited movement, with Dogecoin and the $TRUMP token trading largely flat.
