Bitcoin has erased more than a trillion dollars’ worth of crypto market value in six weeks, forcing the market to confront how much borrowed money had been propping up positions across the sector.
This is the analysis of Nigel Green, CEO of one of the world’s largest independent financial advisory organizations as global stocks and risk-on assets extend losses.
In this context, ‘leverage’ means some traders had been using borrowed funds to boost the size of their positions.
When prices fell, those positions were automatically closed by exchanges, creating forced selling that intensified the decline. It is a mechanical process that can make routine pullbacks look more dramatic than the fundamentals justify.
Nigel Green, CEO of deVere Group, says this leverage reset is the core driver of the current crypto downturn.
“This is leverage being cleared out. When traders borrow heavily to magnify positions, any reversal triggers liquidations that accelerate the move,” he says.
“The long-term case for Bitcoin, among other major digital assets, remains intact.”
He adds that the sell-off is unfolding against a backdrop of broader unease. Investors are focused on softer labor-market signals, the sustainability of AI and tech valuations, tariff effects under President Donald Trump’s administration, and the direction of US interest rates.
These factors have created a cautious mood across speculative assets.
“People are worried about jobs, about whether the AI and tech surge can keep its pace, about tariffs, and about upcoming Fed policy decisions,” explains the CEO.
“These concerns are shaping sentiment, but they don’t alter the structural trajectory for Bitcoin and/or standout AI and tech opportunities.”
deVere’s analysis indicates that the market is being driven more by sentiment than by long-term fundamentals.
Pricing already reflects a substantial degree of caution. As clarity emerges on labor-market trends and policy signals, confidence can be expected to rebuild quickly.
“History teaches us that these phases have reversed faster than expected once the pressure points begin to ease.
“When fear dominates and leverage unwinds, the foundations of the next recovery, typically, start to appear,” he comments.
“Investors are waiting for a broader improvement in confidence. Confidence tends to rebuild rapidly when the excess leverage is out of the system.”
Nigel Green concludes: “Sentiment can turn quickly. Currently, markets need greater confidence from investors as a whole, and that confidence is likely to return once the major concerns lift.”
