Bitcoin’s performance in the third quarter has been less than stellar, with the cryptocurrency trailing behind equities, metals, and even the U.S. dollar. This lackluster showing comes despite Bitcoin’s historical reputation for volatility and potential for rapid gains. As the third quarter closes, market participants are left pondering the factors contributing to Bitcoin’s underperformance and what might lie ahead.
A Quarter of Struggles
September 29, 2025, marks the end of a challenging quarter for Bitcoin, closing it with only a modest 1% gain. The cryptocurrency had a particularly tough week, recording its third-worst weekly performance of the year with a 5% drop. While Bitcoin’s September remained relatively flat, the overall quarterly performance did little to inspire confidence among investors.
Several catalysts have been blamed for Bitcoin’s recent struggles. On Friday, options worth over $17 billion expired, with the max pain price—a level where option holders face the most losses—anchored at $110,000. This acted as a gravitational pull on the spot price, preventing any significant upward movements.
Technical Levels to Watch
For those following Bitcoin’s technical indicators, the short-term holder cost basis at $110,775 has emerged as a critical level. This metric, representing the average on-chain acquisition price for coins moved in the past six months, was tested by Bitcoin in August. Historically, during bull markets, Bitcoin tends to move toward this line multiple times. However, this year has seen it dip below that level only once, during the tariff tantrum in April when it plummeted to $74,500.
Caleb Franzen, a respected analyst, notes that Bitcoin has slipped below its 100-day exponential moving average (EMA), with the 200-day EMA positioned at $106,186. To maintain the broader uptrend characterized by higher highs and higher lows, Bitcoin must stay above the previous significant low of $107,252 set on September 1.
Macro Backdrop and Broader Market Context
The macroeconomic landscape has been favorable for other asset classes, with the U.S. economy growing at an annualized rate of 3.8% in the second quarter. This exceeded the 3.3% estimate and marked the strongest performance since the second quarter of 2023. Additionally, initial jobless claims fell by 14,000 to 218,000, the lowest level since mid-July. Despite the positive economic indicators, Bitcoin’s performance has not mirrored that of U.S. equities, which are just shy of record highs.
Meanwhile, metals have been leading the charge, with silver nearing an all-time high at $45, a level last seen in 1980 and 2011. The yield on 10-year U.S. Treasuries has rebounded from the 4% support and now trades near 4.2%, while the dollar index (DXY) hovers around its long-term support at 98. In contrast, Bitcoin remains more than 10% below its peak, making it an outlier in the current market landscape.
Bitcoin-Exposed Equities and Volatility Concerns
Bitcoin-exposed equities have also faced challenges, with companies like Strategy (MSTR) experiencing severe multiple-to-net-asset-value (mNAV) compression. Although MSTR is barely positive for the year, it dipped below $300 at one point, a negative return for 2025. The ratio between Strategy and BlackRock iShares Bitcoin Trust ETF (IBIT) stands at 4.8, a low not seen since October 2024, highlighting Strategy’s underperformance relative to Bitcoin over the past 12 months.
MSTR’s enterprise mNAV currently sits at 1.44, reflecting basic shares outstanding, total notional debt, and total notional value of perpetual preferred stock minus the company’s cash balance. Despite these challenges, MSTR’s Executive Chairman, Michael Saylor, remains optimistic. Three of the company’s four perpetual preferred stocks—STRK, STRC, and STRF—are showing positive lifetime returns, and Saylor plans to acquire more BTC through these vehicles.
However, Bitcoin’s declining implied volatility—currently below 40, its lowest in years—poses a significant issue for MSTR. Saylor has often positioned MSTR as a volatility play on Bitcoin, but with MSTR’s implied volatility at 68 and its annualized standard deviation of daily log returns over the past year at 89% (falling to 49% over the last 30 days), the lack of volatility is acting as a headwind. For equities, higher volatility typically attracts speculators, generates trading opportunities, and captures investor attention, making the current decline a concern.
Challenges and Opportunities Ahead
The fifth-largest Bitcoin treasury company, Metaplanet, also faces hurdles. Despite holding 25,555 BTC and having approximately $500 million left to deploy from its international offering, its share price struggles at 517 yen ($3.45), over 70% below its all-time high. Metaplanet’s mNAV has dropped to 1.12, a sharp decline from 8.44 in June, with its market capitalization now at $3.94 billion compared to a Bitcoin NAV of $2.9 billion.
Looking ahead, Bitcoin’s trajectory remains uncertain. While some see the current challenges as a temporary setback in an overall bullish market, others view them as indicative of deeper issues. As always in the world of cryptocurrency, volatility and rapid changes are par for the course. Investors and analysts alike will be watching closely to see whether Bitcoin can regain its footing and reclaim its status as a market leader.
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
