The late 2025 cryptocurrency slump

Syed Rahman considers the losses that the crypto sector has endured recently and the possible mis-selling implications.

2025 could be viewed as a year that typified the cryptocurrency world.

It began with optimism that a Donald Trump US presidency would give the crypto sector increased freedoms. This was followed by huge increases in the value of some assets; with excited reports of bitcoin peaking at $126,000 in early October.

And yet those who have often warned about the volatility of crypto will have felt vindicated by what followed: $1 trillion in value being wiped off the market, billions of assets liquidated at breakneck speed and plunging market prices for some of the most high-profile cryptocurrencies.

For many, this will be confirmation that buying and selling crypto is a risk that is not worth taking. Others, who are involved in the sector, will see this as a storm that needs to be ridden out. But if there is to be a sustained period of losses (or of little or no gains) across the board, this is likely to affect confidence in the sector.

Mis-selling

A lack of confidence in any financial sector will be reflected in falling values and, arguably, mis-selling. And crypto is no different. Crypto mis-selling has been going on as long as crypto has been in existence, as is the case with the mis-selling of more traditional assets such as stocks and shares. For those looking to offload assets that are tumbling in value, the temptation to “cut corners’’ may prove too strong.

The current turbulence around crypto could prompt some of the less scrupulous players in the sector to underplay the volatility of the market to would-be buyers. They may even promise financial returns that are unlikely to happen; at least in the short to medium term.

For many who are new to crypto, being subject to high-pressure sales tactics from unregulated firms who fail to make clear the investment risks, or make inaccurate or misleading claims, could prove hugely damaging. Those with little or no experience of crypto who are lured with false promises of easy profits may be viewed as easy targets by those looking to be rid of assets whose value is diminishing.

Steps

There are, however, steps that would-be crypto investors can take to reduce the chances of them being duped. For those in the UK, checks can be made to see if those looking to sell crypto are on the Financial Conduct Authority (FCA) register of authorised firms. It is important to make sure that the contact details provided by the would-be seller match those on the FCA’s register, otherwise they could be a fake version of a genuine, authorised company.

Similarly, any claims about promised returns and little or no risk need to be researched. This should be done by seeking independent advice. There are many with in-depth expertise and experience of the crypto sector that can assess any seller’s offer and determine whether it is legitimate and worth pursuing.

The global currents affecting crypto mean that many such assets are currently undergoing a downturn. Those looking to take their first steps into the crypto world need to tread carefully.