Bitcoin Drops 6.4% in Largest One-Day Fall Since March (Whats Going On?)

Bitcoin’s Sharp Decline Rekindles the Debate Over Its True Value

Bitcoin remains a divisive topic among conservative investors, and its latest move only fuels the debate. The cryptocurrency fell 6.4% overnight, marking its largest single-day drop since March. The decline didn’t just hit digital assets, it also rippled through related equities. Companies like Robinhood, MicroStrategy, and Block all fell more than 3%, as their valuations remain closely tied to Bitcoin’s price movements.

But why is BTC so controversial among investors? Opinions differ sharply on its utility and intrinsic value.

Some argue that Bitcoin lacks fundamental value, viewing it as a purely speculative asset driven by sentiment rather than substance. Others, however, see it as a hedge against inflation and monetary expansion, describing it as a modern store of value akin to digital gold.

In the following sections, we’ll break down both perspectives, examining the core arguments that make BTC one of the most polarising assets in modern finance, and why its influence now extends far beyond the crypto market itself.

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BTC Enters Bear Market, Down 30% as Institutional Flows Drive Volatility

BTC has officially entered bear market territory, now down more than 30% from its recent peak. It’s a familiar pattern for long-term observers. In 2022, Bitcoin peaked around US$69,000, only to bottom near US$16,000 before staging a dramatic recovery to reach new all-time highs near US$124,000 earlier this year.

The latest cycle has been driven by a surge in institutional participation, following the launch of US spot Bitcoin ETFs, which are now available through most major banks and asset managers. This opened the door to a new wave of capital inflows, trading activity, and institutional positioning, similar to what happens with high-growth tech investments, but on a much larger scale.

According to Farside Investors, as of December 1, cumulative net inflows into US spot Bitcoin ETFs have reached roughly US$60 billion, including contributions from major funds such as BlackRock, Fidelity, and Grayscale’s GBTC. For context, November 2025 saw record net outflows of about US$3–4 billion amid Bitcoin’s sharp price pullback, highlighting just how volatile institutional sentiment can be.

For investors, the key takeaway is that Bitcoin’s near-term price action will increasingly mirror high-beta tech stocks, heavily influenced by liquidity flows, risk appetite, and macro sentiment. While institutional adoption strengthens Bitcoin’s long-term case, it also means the asset will trade with greater volatility as capital rapidly moves in and out of the market. But that’s not to say in the long term it could behave more like the inflation hedge that bitcoin bulls pose.

Why BTC Defies Traditional Valuation Frameworks

The question of Bitcoin’s intrinsic value remains one of the most debated topics in modern finance and economics, with no clear consensus. Traditionally, intrinsic value refers to an asset’s inherent worth based on fundamental factors such as cash flows, productive utility, or tangible backing. Bitcoin, by contrast, does not generate cash flows or represent a claim on physical assets, which makes it difficult to value through conventional frameworks.

When miners join the Bitcoin network, they are rewarded with new Bitcoin for validating transactions, a mechanism that can loosely be compared to a dividend-like reward for participating in the network’s security and maintenance. However, scarcity alone, with supply capped at 21 million coins, does not automatically confer intrinsic value.

BTC True Value May Lie in Its Utility, Not Its Tangibility

Where Bitcoin may hold a form of practical intrinsic value is through its network effects and utility as digital gold. It enables decentralised, borderless, and trustless transactions, offering users financial sovereignty independent of centralised intermediaries or governments. In that sense, its worth is subjective and demand-driven, not intrinsic in an absolute sense.

Many philosopher-economists argue that nothing, apart from human well-being, possesses true intrinsic value, everything else, from stocks to art, gains worth extrinsically, based on how it serves people. Bitcoin fits that definition: it derives its value from the utility it provides, whether as a hedge against monetary debasement, a vehicle for speculation, or a symbol of economic independence.

In an AI-driven and increasingly digital world, where trust in fiat systems may erode, some view Bitcoin’s lack of traditional intrinsic ties as its greatest strength, a feature that makes it resilient to centralised control and potentially more relevant in the future financial order.