Bitcoin Avoids Traditional Year-End Rally, Setting Stage for Q1 Stability According to Anthony Pompliano

Bitcoin‘s relatively muted performance through December 2025 may actually shield the cryptocurrency from the dramatic first-quarter crashes that have historically followed euphoric year-end rallies, according to prominent crypto investor Anthony Pompliano.

Speaking on the current market dynamics, Pompliano highlighted that Bitcoin has maintained its status as a “monster in financial markets” despite trading around $88,000 as of December 20, well below the most optimistic year-end targets that reached as high as $150,000. The digital asset peaked at approximately $126,000 in early October before retreating to current levels, representing a roughly 30% decline from its all-time high.

The absence of a traditional “crazy” year-end surge could prove beneficial for Bitcoin’s stability heading into 2026. Historical data shows that dramatic Q4 rallies have often preceded severe first-quarter corrections. In contrast, the current price consolidation around the high-$80,000s suggests a more measured market environment.

Market data reveals a complex picture for Bitcoin as 2025 draws to a close. U.S. spot Bitcoin ETFs, which were a major driver of institutional adoption earlier in the year, have reportedly reduced holdings by approximately 24,000 BTC during Q4 2025, reversing the previous year’s accumulation pattern. BlackRock‘s iShares Bitcoin Trust (IBIT) posted its first monthly outflows on record in November, totaling $2.3 billion.

Despite these near-term headwinds, Wall Street analysts maintain bullish long-term projections for the cryptocurrency. Standard Chartered’s Geoff Kendrick and Bernstein’s Gautam Chhugani both expect Bitcoin to reach $150,000 in 2026, representing a 74% upside from current levels. These forecasts, while revised downward from earlier predictions, reflect confidence in Bitcoin’s fundamental trajectory even as analysts acknowledge a more challenging market environment.

The current market structure differs markedly from previous cycles. The S&P 500 has generated positive returns of approximately 15% year-to-date, while Bitcoin shows a decline of roughly 5% for 2025. This divergence hasn’t been seen since 2014, when traditional markets outperformed Bitcoin on an annual basis.

Corporate Bitcoin accumulation continues to provide underlying support. MicroStrategy, now known as Strategy Inc., has maintained its aggressive Bitcoin purchasing strategy, acquiring 10,645 BTC for $980.3 million during December 8-14 at an average price of $92,098. The company now holds 671,268 BTC worth approximately $59 billion at current market prices.

The absence of extreme volatility during the traditional year-end “alt season” may indicate a maturing market structure. Options data shows a significant $23 billion expiry looming on December 26, which could influence near-term positioning but appears unlikely to trigger the dramatic moves that characterized previous cycles.

Looking ahead to Q1 2026, the relatively stable price action through December could establish a foundation for more sustainable growth. Historical patterns suggest that when Bitcoin avoids parabolic year-end rallies, the subsequent quarter tends to show less dramatic corrections. This environment may favor institutional investors seeking exposure without the extreme volatility that has characterized previous cycles.

Market participants are closely monitoring ETF flows as a key indicator of institutional sentiment heading into 2026. While Q4 outflows represent a near-term headwind, the underlying infrastructure for institutional Bitcoin adoption remains robust, potentially setting the stage for renewed accumulation once market conditions stabilize.