PIPE Overhang and Broader Economic Uncertainty Trigger Significant Crypto Decline
- Crypto markets face sharp declines as macroeconomic uncertainty and structural challenges drive Bitcoin and altcoins lower, with BTC trading at $109,385 as of September 25, 2025. - PIPE deals in crypto treasury companies exacerbate sell-offs, with stocks like Kindly MD (NAKA) plummeting 97% post-lockup expiration due to liquidity-driven "overhang" effects. - U.S. GDP revisions and falling jobless claims reduce Fed rate-cut expectations, pushing capital into traditional assets and dragging down crypto-lin
The cryptocurrency sector remains under significant selling pressure, as
Private investment in public equity (PIPE) transactions have become a major contributor to the downturn among crypto treasury firms. These companies, which maintain large Bitcoin holdings, have raised funds by issuing shares at a discount. However, when PIPE shares become tradable again, renewed selling often pushes stock prices lower. For instance,
Recent U.S. economic indicators have added to the uncertainty for digital assets. The second quarter’s GDP growth was revised to 3.8%, and initial jobless claims fell to 218,000, reducing the likelihood of aggressive interest rate cuts by the Federal Reserve. The yield on 10-year U.S. Treasuries jumped to 4.20%, a three-week high, as investors favored traditional investments. This risk aversion has impacted crypto-related stocks, with MicroStrategy (MSTR) and Coinbase (COIN) dropping 4.5% and 4.1%, respectively. From a technical perspective, Bitcoin faces fragile conditions, with support at $109,898 and resistance near $115,000.
Blockchain data reveals mounting bearish sentiment. Large holders, or whales, have increased their selling, with 147,000 BTC offloaded in just one month, according to CryptoQuant. This selling has intensified downward momentum, keeping Bitcoin below the $115,000 threshold. Analysts at 10x Research warn that Bitcoin could swing by $20,000 in either direction in early Q4 2025, underlining the market’s vulnerability to macroeconomic changes and liquidity shifts.
The outlook for crypto treasury firms and alternative coins depends on Bitcoin’s ability to stage a sustained recovery. Without a significant rebound in BTC, many companies may see their share prices approach or fall below PIPE offering levels, potentially triggering further selling and deepening losses across both crypto and equity markets. Altcoins such as XRP and DOGE also remain exposed to broader economic pressures, with their fortunes closely linked to Bitcoin’s movements.
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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