Great Bitcoin Crash of 2025 Has It Lagging Bonds, Gold and More

Cryptocurrency

Summary:

Demand for downside protection around the $85,000 and $80,000 levels has surged, and options data suggest less than a 5% chance of Bitcoin revisiting its record high above $126,000 by year-end.

The asset once expected to “go to the moon” is struggling to keep pace with Treasuries. Bitcoin has fallen nearly 30% from its 2025 peak, lagging behind everything from tech stocks to T-bills.

Once promoted as a high-growth play, an inflation hedge, and a portfolio diversifier, the world’s largest cryptocurrency now faces the prospect of ending the year in the red — without fulfilling any of those roles.

Gold — often dismissed by Bitcoin believers as outdated — is easily outperforming the token, which the crypto faithful have dubbed digital gold. So are long-term bonds and the Nasdaq, in a year defined by falling interest rates and shrinking risk appetite.

The underperformance is even starker against benchmarks Bitcoin was supposed to outclass. The MSCI Emerging Markets Index is up sharply this year, and even the US Utilities Index — a byword for low-volatility, low-growth stability — has outpaced Bitcoin’s slide.

On Tuesday, Bitcoin briefly dipped below $90,000 — roughly the average entry price of all ETF inflows since their launch — meaning the typical ETF investor was, for a while at least, underwater. The largest cryptocurrency climbed off the seven-month low to trade about 1.5% higher to $93,241 as of 11:46 a.m. in New York.

For many, this was supposed to be crypto’s breakout year. A pro-crypto White House, new rules allowing launch of exchange-traded funds across tokens, and a wave of institutional inflows had seemingly secured digital assets a place in mainstream finance. Instead, for investors who bought near the highs, Bitcoin’s 2025 story feels familiar: a burst of euphoria, a crash, and growing disbelief.

Once pitched as everything from an inflation hedge to a growth engine and an uncorrelated store of value, the token has fallen short on every count of late. Volatile? Always. Reliable? Less and less.

That matters for professional investors. In diversified portfolios, Bitcoin has failed to offset losses from tariff-driven selloffs or amplify gains during rebounds. Nor has it acted independently when other markets turned volatile. For fund managers who saw crypto as a strategic addition, the disappointment goes beyond performance — it cuts to purpose. Great Bitcoin Crash of 2025 Has It Lagging Bonds, Gold and More_1

Great Bitcoin Crash of 2025 Has It Lagging Bonds, Gold and More_1

Theories about what went wrong vary. Some blame October’s violent crash, which erased roughly $19 billion in leveraged positions and left deep psychological scars across the market. “10th October is definitely a longer lasting shock to the market than it appears on the surface,” said George Mandres, senior trader at XBTO Trading. “As much as market participants will try to forget or brush it off, it will remain deeply embedded in the appetite of market-makers to provide liquidity and in market participants’ conviction and risk appetite.”

Others point to broader market weakness. “Asia printed softer growth data overnight, Chinese equities weakened, and global tech valuations retreated as investors reassessed pricing ahead of Nvidia’s earnings on November 19,” said Timothy Misir, head of research at digital asset analytics firm BRN. “With liquidity conditions already thin, correlations snapped back to their high-beta defaults. Crypto traded not as a hedge, but as the most leveraged expression of macro tightening.” Great Bitcoin Crash of 2025 Has It Lagging Bonds, Gold and More_2

Great Bitcoin Crash of 2025 Has It Lagging Bonds, Gold and More_2

“Talks of an incoming bear market are starting to ring louder and louder,” said Augustine Fan, director at SignalPlus.

To be sure, Bitcoin still trades well above levels seen before Donald Trump’s re-election, and its history is filled with sharp declines followed by spectacular recoveries. Over longer horizons, returns remain impressive. But for now, traders are positioned defensively. Demand for downside protection around the $85,000 and $80,000 levels has surged, and options data suggest less than a 5% chance of Bitcoin revisiting its record high above $126,000 by year-end, according to data from Coinbase-owned Deribit.

What Bloomberg Strategists say...

“For now, Bitcoin looks like it’s trying to reassert its leadership role — only this time, as a sign of stabilization rather than stress. If $90,000 holds, it could mark the moment where the digital asset space starts leading risk sentiment higher, not lower.”

Source: Bloomberg

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Manuel

Commodity

China–U.S. Trade War

China significantly accelerated its purchases of American soybeans in a move that ends a temporary pause and appears to signal a commitment to a trade truce reached late last month.

The US Department of Agriculture on Tuesday announced the sale of 792,000 tons of soybeans to China for the 2025-2026 marketing year, the biggest daily purchase in two years. That brings China’s total known purchases of US soybeans since early October to just over one million tons.

US President Donald Trump said Tuesday he wants China to “speed up” soybean purchases, and asked Treasury Secretary Scott Bessent to make the request directly to Beijing. Even so, Trump told reporters in the Oval Office that “our relationship with China has been very good. And as far as buying our farm products, they’re pretty much on schedule.”

Earlier, Bloomberg reported that state-owned agriculture trader Cofco Group booked nearly 20 cargoes of the American oilseed on Monday for delivery in December and January, according to people familiar with the matter who asked not to be identified because they’re not authorized to speak to media.

The sales were from Pacific Northwest ports and US Gulf terminals, they said. Cofco did not immediately reply to a request for comment.

The purchases have reignited market optimism around the soybean trade between the two agricultural powerhouses, which was worth more than $12 billion last year. Until recently, China had held off buying US soybeans for much of the season as the country sought a bargaining chip during tariff negotiations. The move hurt American growers, who have been challenged by inflation and high farming input costs.

Still, US beans are already more expensive than Brazil’s ahead of what’s likely to be another bumper harvest in South America. Industry group Abiove earlier Tuesday hiked Brazil’s soy output for the incoming harvest to a new record of 177.7 million tons. China Makes Biggest Purchase of US Soybeans in Two Years_1

China Makes Biggest Purchase of US Soybeans in Two Years_1

Chicago soybeans were choppy Tuesday, following a Monday rally that saw prices at a fresh 17-month high.

“Traders have one eye on exports and one on South America’s crop-growing weather,” said Total Farm Marketing analyst Naomi Blohm.

Beijing’s latest purchases still leave plenty to be done in the coming months, at a time when stockpiles are plentiful. Washington has said Beijing pledged to buy 12 million tons of US soybeans by end of this year, followed by 25 million tons annually over the next three years.

While China has yet to confirm the specific purchase commitments, it has moved to reduce tariffs on the crop and lifted import bans on three American exporters, including CHS Inc., reciprocating similar conciliatory actions from the US.

“Close attention will be paid as to whether China continues to secure US soybeans,” AgResource Co. said in a note, adding that US soybeans were being purchased at a premium to Brazilian prices.

“The point is that China did not want to buy US soybeans — it was a political push from the Trump administration,” AgResource said in a separate note. Still, it expects additional purchases from China will be announced Wednesday.

Source: Bloomberg

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Thomas

Central Bank

The Bank of England will cut interest rates in December and again early next year as inflation cools over coming months, according to a majority of economists in a Reuters poll who last month expected borrowing costs to remain unchanged for the remainder of this year.

Next month's meeting will follow British Finance Minister Rachel Reeves' Autumn Budget on November 26 where she is no longer expected to raise income tax but will make up an expected shortfall through smaller tax rises from other sources.

The Monetary Policy Committee voted 5-4 to leave rates unchanged earlier this month, with BoE Governor Andrew Bailey casting the deciding vote, wanting to wait for evidence of declining inflation before committing to a cut.

Nearly 80% of economists, 48 of 61, expect the BoE will cut Bank Rate by 25 basis points to 3.75% on December 18, according to a Reuters poll taken November 13-18. The rest forecast no move.

That compares with 54% who expected unchanged rates for the remainder of the year in an October survey. Around that proportion now expect a follow-up cut to 3.50% in Q1 2026.

"We see a December rate cut as the default action, absent any wildly hawkish surprises in the next two inflation prints," said Gabriella Willis, UK economist at Santander CIB.

"We expect Governor Bailey to remain the swing voter. The October and November inflation prints, alongside signs of a softening jobs market, will be the final green light to a cut."

Interest rate futures have almost completely priced in a December cut.

Inflation has been stuck at 3.8%, nearly double the BoE's 2% target, since July. Data due to be released on Wednesday are likely to show a cooling to 3.6% in October.

Median forecasts predicted inflation averaging 3.0% and 2.5%, respectively, in the following two quarters.

Growth is expected to average 1.4% this year, slowing to 1.1% next year, according to poll medians.

"We are still expecting the Budget to be disinflationary, but less so than our original base case which included a larger hit to demand from lifting income tax," said Willis.

Source: Investing

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Gerik

Economic

Commodity

A Policy Reversal with Global Impact

On November 13, 2025, U.S. President Donald Trump signed an executive order retroactively reducing and exempting import tariffs on a broad range of agricultural commodities. Aimed at curbing rising grocery prices and easing consumer dissatisfaction, this order affects high-demand goods such as beef, bananas, chocolate, tomatoes, and notably, coffee. It marks a significant departure from Trump’s previous tariff-heavy stance, signaling a pragmatic shift in trade policy amid growing economic pressure and Republican losses in recent local elections.

This executive order was implemented immediately and partially exempts listed items from previously imposed retaliatory duties. While not granting complete immunity, it removes these goods from the most punitive tax brackets. For example, despite some relief, Mexican tomatoes will continue to face a 17% tariff applied since July.

Coffee in Focus: A Strategic Commodity

Among all impacted goods, coffee stands out as a product of strategic importance to Vietnam. As the world’s largest coffee importer, the U.S. consumed nearly USD 9 billion worth of coffee in 2024. Brazil remains the leading supplier in value terms, while Vietnam ranks third in volume and eighth in value, with exports worth USD 364 million.

Vietnam's performance in 2025 has been robust. According to the Ministry of Finance’s Customs Department, Vietnam exported 3,864 tonnes of coffee to the U.S. in October alone, valued at USD 19.4 million. Over the first ten months of 2025, coffee shipments reached 74,680 tonnes, bringing in nearly USD 407 million, a year-on-year increase of 85% in value and 10% in volume. This surge is largely attributed to global coffee price hikes and improved market access.

With the new tariff reductions, Vietnamese coffee stands to gain even more ground. Treasury Secretary Scott Bessent emphasized that the U.S. is focusing tariff relief on products that cannot be efficiently produced domestically. Coffee was explicitly listed as a priority commodity, along with tropical fruits such as bananas and pineapples.

Economic Motivation Behind Tariff Cuts

The decision to roll back tariffs is a direct response to sustained inflation and consumer frustration. Recent U.S. Consumer Price Index (CPI) data highlights steep food price increases: ground beef surged by nearly 14%, beef cuts jumped 17%, bananas rose 7%, and tomatoes crept up 1%. Overall, home food costs climbed 2.7% in September 2025 compared to the previous year, disproportionately affecting low- and middle-income households.

The policy shift contradicts Trump’s earlier position that tariffs do not burden U.S. consumers. Faced with economic data and political fallout, the administration appears to have recalibrated priorities, seeking to ease food prices swiftly through more open trade.

Bilateral Trade Agreements Amplify Opportunity

Vietnam’s coffee prospects are further bolstered by recent bilateral negotiations. The Vietnam-U.S. Joint Statement on Reciprocal, Fair, and Balanced Trade issued in late October outlined a roadmap for tariff exemptions. According to Executive Order No. 14356, released in September 2025, Vietnamese exports falling under Appendix III may receive a 0% reciprocal tariff rate. The criteria emphasize goods that cannot be cultivated, harvested, or produced in the U.S. at scale, divided into three categories: select agricultural products, aerospace components, and non-patented pharmaceutical inputs.

Coffee qualifies under this framework. U.S. Trade Representative Jamieson Greer confirmed that Vietnamese coffee would benefit from 0% tariffs under the agreement, citing the absence of domestic coffee production capacity. His remarks, delivered aboard Air Force One, were further supported by President Trump himself, who stated, "We want to bring coffee prices down a bit."

Causal Pathway Between Policy and Market Expansion

The causal link between reduced tariffs and Vietnam’s market share expansion in the U.S. is direct. Lower import costs incentivize U.S. buyers to source from competitive suppliers like Vietnam. With Brazil already dominant, Vietnam's comparative advantage in Robusta coffee, price competitiveness, and production volume allows it to penetrate market segments underserved by other exporters.

However, the relationship is not strictly deterministic. While tariff cuts reduce financial barriers, actual trade growth depends on supply chain readiness, logistical capacity, marketing efforts, and quality standards compliance. For instance, exporters must ensure consistency in bean quality and adapt to U.S. food safety protocols to fully exploit the regulatory opening.

Outlook for Vietnamese Coffee Industry

The U.S. market, with its size and growing preference for diversified origins, presents a fertile ground for Vietnamese coffee expansion. The zero-tariff access, coupled with existing production momentum, provides a favorable runway for growth. As demand for sustainably produced and traceable coffee increases, Vietnamese exporters can leverage this momentum by emphasizing value-added offerings such as specialty Robusta and UTZ- or Rainforest Alliance-certified beans.

If capitalized effectively, this opportunity may not only boost Vietnam’s share in the U.S. market but also increase bargaining power in global trade negotiations and improve income for domestic coffee farmers.

Vietnam’s coffee sector is on the verge of a strategic inflection point. The Trump administration’s tariff rollback, paired with bilateral alignment, has created an unusually advantageous window for Vietnam to scale its presence in the largest coffee-consuming market in the world. Whether this translates into long-term structural gains will depend on how quickly and strategically the industry responds.

To stay updated on all economic events of today, please check out our Economic calendar

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Gerik

Economic

Parliamentary Approval Signals Tax Policy Reform

On November 17, 2025, Vietnam’s National Assembly Standing Committee formally passed a resolution to adjust personal income tax deductions starting with the 2026 tax year. The new deduction levels are set at VND 15.5 million per month for taxpayers and VND 6.2 million per month for each dependent, marking a significant rise of over 40% compared to the previous thresholds. The revision is embedded within the forthcoming amendment of the Personal Income Tax Law and is expected to be enforced from January 1, 2026.

The primary rationale behind the adjustment lies in bridging the gap between stagnant tax thresholds and rising living costs. Since the previous revision under Resolution 954/2020, cumulative inflation as measured by the consumer price index has grown approximately 21.24%. This inflationary pressure, along with continued income and GDP per capita growth between 2020 and 2025, prompted the Ministry of Finance to propose an updated policy that reflects the actual cost of living and disposable income needs.

Two policy proposals were evaluated. The first suggested adjusting deductions based on CPI growth, offering a more conservative increase to VND 13.3 million and VND 5.3 million for taxpayers and dependents, respectively. This option would have reduced state budget revenues by an estimated VND 12 trillion annually. The second, more expansive approach which was ultimately adopted proposed adjustments aligned with average income and GDP growth. This resulted in the finalized deduction levels and a projected annual revenue reduction of approximately VND 21 trillion.

While both approaches involved revenue trade-offs, the government favored the second, arguing that it better captured income trends and enhanced the economic welfare of middle-class households.

Budgetary Considerations and Timing

A key aspect of the policy’s feasibility lies in its fiscal timing. Because the new deductions will only apply to the 2026 tax year with tax filings occurring in the first quarter of 2027 the changes will not impact the 2025 fiscal budget. Deputy State Auditor General Trần Minh Khương emphasized this point, adding that when revising the tax law, further reforms could consider regional income disparities, much like existing minimum wage differentiations by region.

Despite some calls to introduce the deduction earlier specifically from the 2025 tax year the alignment with the revised tax law and legal consistency ultimately made 2026 the preferred implementation point. This sequencing simplifies legal interpretation, ensures transparency, and facilitates broader compliance.

Broader Economic Implications and Consumption Stimulus

This tax reform extends beyond fiscal recalibration. By increasing post-tax income, the policy is also expected to boost domestic consumption. The link between tax reductions and household spending is typically a causative relationship: lower taxes increase disposable income, which tends to drive higher retail and service sector activity. This effect is particularly relevant amid ongoing economic recovery and efforts to stimulate private sector growth.

Additionally, the higher deductions are anticipated to reduce the tax burden on salaried workers, civil servants, and middle-income households, which constitute a growing segment of Vietnam’s workforce. This supports broader goals of inclusive economic development and labor market stabilization.

Legislative Intent and Public Signaling

Leaders from the National Assembly including Deputy Chairpersons Nguyễn Khắc Định and Vũ Hồng Thanh emphasized the symbolic weight of this resolution. In light of recent economic and natural disruptions, the decision sends a politically positive message: that the government is prioritizing citizen welfare and responding to the cost-of-living realities faced by millions.

Concluding the session, Vice Chairman Nguyễn Đức Hải confirmed that the new deduction levels will be officially written into the amended Personal Income Tax Law, with effect from 2026. The revised policy is thus positioned as a structural upgrade to Vietnam’s tax code, offering clarity, consistency, and broader fiscal equity.

Structural Role in Tax Code Modernization

Beyond immediate financial relief, this adjustment represents a foundational element in the modernization of Vietnam’s tax system. It acknowledges that static deductions, when unresponsive to inflation or income growth, distort the equity of the tax code over time. By re-benchmarking deductions in line with economic performance, the revised framework ensures the tax burden remains proportionate and fair.

In the longer term, this policy move provides a framework for periodic review of tax thresholds based on macroeconomic indicators. As income inequality, regional disparities, and social spending priorities evolve, a dynamic tax policy that adapts to these changes will be essential to sustainable development.

This reform sets the stage for a more responsive, transparent, and inclusive tax environment one that not only raises fiscal efficiency but also enhances social stability through income protection and purchasing power preservation.

To stay updated on all economic events of today, please check out our Economic calendar

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Gerik

Economic

Strategic Outlook: Coordinated Economic Policy for a High-Growth Era

Vietnam is entering a pivotal phase of development, targeting a transformational period between 2026 and 2030. The government has set ambitious benchmarks, including a GDP growth rate of at least 8% in 2025 and sustained double-digit growth in the years to follow. This forward-looking agenda is anchored in a synchronized approach involving expansive fiscal investment and supportive monetary easing. The overarching vision is to transition Vietnam into a high-income economy by 2045, with a strong emphasis on macroeconomic stability and structural reform.

The current international environment has created favorable conditions for Vietnam to implement monetary stimulus. The US Federal Reserve’s recent decision to cut interest rates by 25 basis points to the 3.75–4% range, along with the planned halt of its quantitative tightening program in December, has eased external pressures. This policy reversal has diminished volatility in Vietnam’s foreign exchange markets and curbed persistent net foreign outflows, which had plagued the equity market since April 2023.

Domestically, the Vietnamese central bank is capitalizing on this window by supporting credit growth. As of the first nine months of 2025, credit expanded by 13.4% compared to the end of 2024, and by 19.6% year-on-year. These figures indicate alignment with the annual credit growth target of 16%, largely fueled by public infrastructure investments, the real estate rebound, and revitalized private investment and consumption.

Fiscal Expansion: Infrastructure as the Engine of Growth

Fiscal policy is being recalibrated to support long-term infrastructure development. Mirae Asset reports that public investment from 2026 to 2030 will reach VND 8.5 quadrillion, a 166% increase over the 2021–2025 period. This capital injection is designed to support mega infrastructure projects such as Long Thanh International Airport, the North-South expressway, and several urban ring roads.

Such a dramatic escalation in fiscal spending is made feasible by Vietnam’s favorable debt profile. The public debt-to-GDP ratio is projected to increase from 34% in 2024 to 42% by 2030, providing fiscal flexibility without jeopardizing financial stability.

The reconfiguration of the national budget structure further reinforces this trajectory. From 2026 to 2030, current expenditure will be adjusted to 50.7% of the total budget, while development investment spending is targeted at 40.7%, up from 31.2% in 2024. This shift prioritizes productive expenditure over routine spending.

Domestic Demand Rebound and Tax Reforms

Domestic consumption is showing tangible signs of recovery, with retail sales rising 9.3% in the first ten months of 2025. This uptick is expected to gain momentum as the government introduces tax relief measures in 2026, notably increasing personal income tax deductions by over 40%. This initiative is aimed at bolstering the purchasing power of the middle class, thereby reinforcing the internal demand base of the economy.

Structural legal reforms are also accelerating, with the implementation of key laws such as the Housing Law 2023, Real Estate Business Law 2023, and Land Law 2024. Effective from August 2024, these legislative changes are intended to resolve long-standing bottlenecks in land use, project development, and housing transactions.

Moreover, Resolution 198/2025/QH15 sets a concrete goal: the private sector is expected to contribute 55–58% of GDP by 2030, compared to the current 50%. This signals a substantial policy shift to empower domestic enterprises and enhance their role in economic growth.

Capital Market Reform and Financial Deepening

Vietnam’s capital market remains bank-centric, with limited corporate bond and equity market development. To address this, authorities aim to increase stock market capitalization to 120% of GDP and corporate bond market size to 25% by 2030, from 68% and 9%, respectively.

Strategic measures being deployed include the adoption of international financial reporting standards (IFRS), enhanced corporate governance in line with OECD guidelines, and regulatory streamlining for IPOs, reducing post-offering listing time from 90 days to 30. These changes aim to attract both domestic and foreign capital, fostering a deeper and more resilient financial market.

According to Mirae Asset, current market conditions remain healthy, with attractive valuations and macroeconomic support. They project earnings-per-share growth in 2026 as a key driver for a market rebound. A fair market valuation of 17x price-to-earnings could push the VN-Index toward the 1,800–2,200 point range.

Sectoral Outlook: Identifying Growth Catalysts

In the context of monetary support, public investment, and digitization, several sectors are poised for strong performance:

Banking will benefit from increased credit demand and improved asset quality, particularly as the property market stabilizes.

Securities and Brokerage Services are undergoing regulatory and technological transformation, underpinned by enhanced liquidity and market upgrades.

Construction, Real Estate, and Building Materials will see direct benefits from public infrastructure expansion, with VND 8.5 quadrillion earmarked for development over the next five years.

Retail is poised for growth driven by rising disposable incomes and targeted tax reforms, positioning it as a vital engine for domestic demand recovery.

Foundation for a Structural Growth Cycle

Vietnam is entering a decisive phase marked by structural investments, regulatory modernization, and coordinated economic policy. The synergy between fiscal expansion and monetary flexibility provides the scaffolding for sustainable, inclusive growth. The transition from a credit-reliant system toward a balanced capital market, alongside productivity-enhancing infrastructure and legal frameworks, suggests that the economy is being primed for a long-term growth trajectory.

If current reforms are effectively implemented and fiscal discipline is maintained, Vietnam could achieve not only its 2030 targets but also lay the foundation for its high-income economy aspiration by 2045.

To stay updated on all economic events of today, please check out our Economic calendar

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Adam

Economic

Huawei has announced groundbreaking AI software that could double the efficiency of its Ascend chips. This is a significant step in the context of export restrictions to China and geopolitical tensions, as it allows the Chinese manufacturer to maximize the use of its available hardware resources. The "software-first" strategy enables Huawei to scale existing chips through clustering and software optimization, enhancing the company's competitiveness in AI, including cloud and inference applications.

Until now, Nvidia has been the virtually undisputed leader in the Chinese AI chip market, offering the highest computational power and a well-established developer ecosystem. However, the increasing efficiency and scalability of Ascend chips, combined with state support for the Chinese producer, are beginning to shift the dynamics of competition. Huawei is gaining adoption among major cloud companies in China and steadily increasing production of its chips, which in the longer term could limit Nvidia’s previously dominant position in the region.

It is worth noting that although Nvidia still dominates globally, the Chinese market is becoming increasingly difficult to maintain without local partners or appropriate strategic adaptations. The efficiency and scalability of Ascend chips, combined with growing demand from local customers, could in practice take away part of Nvidia’s market share in China, particularly in inference and cloud AI segments. For Nvidia, this means closely monitoring local developments, adjusting pricing and technology strategies, and facing the potential risk of losing its competitive edge in a key Asian region.

Currently, the AI technology boom appears to be at a crossroads. Markets are cautious about technology company valuations, while the rapid pace of innovation and rising competition in China are adding further volatility. In this context, Huawei may set new standards and accelerate local AI adoption, which on one hand intensifies competition, and on the other highlights that Nvidia can no longer treat the Chinese market as a fully secure space for its growth.

In practice, the question of whether Nvidia is losing the Chinese market is no longer theoretical. The growing influence of Huawei and other local players demonstrates that even global leaders must account for regional shifts in power, as the AI market in China becomes an arena of increasingly fierce competition.