The digital asset industry is experiencing its most severe downturn due to a combination of factors. According to Joe Weisenthal and Tracy Alloway, hosts of Bloomberg's Odd Lots podcast, the current period is marked not just by falling prices, but by a "loss of faith" and a systemic crisis of ideas.

Weisenthal emphasized that while Bitcoin has seen deeper price drops in the past, the current situation is characterized by market participants' demoralization. Among the key reasons identified by the experts are:

  • Collapse of protective narratives: The first cryptocurrency has failed to confirm its status as a hedge against inflation—amid dollar instability, investors have turned to gold;
  • Competition with AI: The artificial intelligence sector has begun to actively absorb capital, engineering talent, and investor attention. Additionally, miners are forced to compete with AI data centers for electricity;
  • Institutionalization issues: The launch of spot ETFs and the move into the mainstream have stripped the market of its "early-stage" development argument. Meanwhile, Wall Street's interest has shifted from trading activity to stablecoins and tokenization;
  • Technological risks: The hosts mentioned the threat posed by quantum computing to cryptographic security and pressure from corporate holders who may start selling off their reserves.

The situation is exacerbated by an "identity crisis" amid a lack of new growth drivers. According to Weisenthal and Alloway, even the launch of powerful models like Claude 4.6 from Anthropic and GPT-5.3 from OpenAI is overshadowing the crypto sphere, leaving it in the shadow of technological progress.

At the time of writing, Bitcoin is trading at $66,975, Ethereum at $1,874, and Solana at $74.97. Despite these high levels compared to previous cycles, experts insist that structurally, this "cold" period is the harshest in the history of the industry.

Source: CoinGecko.

It is worth noting that on June 2, the price of the first cryptocurrency fell below $70,000. This decline occurred amid escalating tensions between the U.S. and Iran, as well as due to the sale of part of its reserves by Strategy.