Commenting on the recent sharp decline in the cryptocurrency market, analyst Charles Edwards argued that two fundamental structural problems lay behind the price collapse.
According to Edwards, the current decline stems not only from macroeconomic pressures but also directly from Bitcoin’s structural risk perception and leveraged models within the sector.
Edwards stated that Bitcoin is considered “the most vulnerable asset to quantum attacks in the world,” and therefore its correlation with stocks and gold has broken down by 2025. According to the analyst, investors have begun pricing in long-term security risks, leading to a divergence from traditional risk assets. This divergence, coupled with weak price performance throughout the year, increased selling pressure.
The second point highlighted by the analyst was the “Treasury Company” model. Edwards noted that hundreds of companies are adding Bitcoin to their balance sheets, acting almost like indirect “Bitcoin ETFs,” but a significant portion of these structures are growing through leverage incentives. According to the analyst, the fact that nearly 200 treasury companies are following similar strategies has increased systemic fragility and called into question the sustainability of the model.
Edwards pointed out that during this process, long-term investors engaged in heavy selling throughout 2025, and that there was also a “wave of exodus” among miners. He stated that with the miner migration, there was a decrease in enterprise value (EV) and production cost metrics, and that many Digital Asset Treasury (DAT) structures even fell below cost basis. He argued that this situation led to a chain reaction of value loss.
However, Edwards argued that a strong repricing of Bitcoin could occur if concrete progress is made toward resolving the current issues. But the analyst noted that it would be difficult for the sector to recover without confronting these two fundamental issues, warning that volatility and painful price movements could continue in the short term.
*This is not investment advice.