Why Crypto Markets Are Falling Behind in the Era of Industry Nationalization

By the end of 2025 and the beginning of 2026, an intriguing market situation has emerged that defies conventional expectations. While global assets are setting new records for long-term growth, Bitcoin remains stagnant. A phrase has spread within the crypto investment community: “ABC” — meaning “Anything But Crypto.” This expression reflects more than just frustration; it signals a deep market divide directly linked to nationalization policies across industries worldwide.

Bitcoin’s Role and Limitations as a Leading Indicator

Raoul Pal, founder of Real Vision, and other analysts have long considered Bitcoin a leading indicator of global risk assets. Historically, Bitcoin’s price movements have often preceded the S&P 500, signaling upcoming market shifts. Since Bitcoin’s valuation isn’t directly controlled by any single country’s economy or central bank interest rates, but rather by global capital flows and liquidity dynamics, it has been viewed as a barometer of broader risk sentiment.

However, this dynamic has recently shifted. Bitcoin has been trading below $100,000 for over three months, marking one of the lowest volatility periods in its history. When its traditional role as a leading indicator fails, it sends a strong warning: market dynamics have fundamentally changed.

Global Liquidity Crisis: Central Bank Contraction Policies

The primary reason for Bitcoin’s weakness in 2025 and early 2026 is the global liquidity crunch. Although the Federal Reserve has cut interest rates in 2024 and 2025, quantitative tightening since 2022 has steadily drained liquidity from markets. Bitcoin reached new highs in 2025 amid inflows into ETFs, but this superficial capital flow couldn’t offset the deeper macro liquidity crisis.

Bitcoin’s current stability reflects this macro reality. In an environment of cash scarcity, no asset can sustain a strong upward trend. This isn’t just Bitcoin’s problem; it impacts the entire risk asset market.

Japan’s Interest Rate Hike: End of the Carry Trade and Global Impact

A second, more complex factor is Japan. As a major source of long-term funding for global risk assets, the Japanese yen carry trade has been a key driver. But in December 2025, Japan’s central bank raised short-term rates to 0.75%, the highest in nearly 30 years. This move has immediately been recognized by analysts as historically significant.

Historical data shows that since 2024, every rate hike by Japan’s central bank has had a negative impact of over 20% on Bitcoin’s price. This is not coincidental but a result of deep economic linkages. The coordinated tightening by the Fed and Bank of Japan is draining global liquidity, disproportionately affecting risk assets like Bitcoin.

Geopolitical Uncertainty: Market Nervousness and Cash Accumulation

A third, even more complex reason is geopolitical instability, which continues to pressure market nerves. In early 2026, significant international uncertainties have arisen: military interventions in Venezuela, potential conflicts with Iran, and discussions around Greenland, among others, heighten global uncertainty.

Domestically, fears of constitutional crises are growing, fueling investor anxiety. In such an environment, the best strategy is to reduce risk and increase cash holdings. When the future is uncertain, investors tend to move away from high-risk assets, directly impacting volatile assets like Bitcoin.

Why Gold and Stocks Are Rising: Effects of State Industry Nationalization

But the key insight lies elsewhere: why have gold increased by 60% and silver by 210%, while Bitcoin has lagged? Why are US stocks and China’s A-shares reaching new records? The answer isn’t found in liquidity alone but in the global industry nationalization policies.

Gold’s rising price reflects growing distrust in the international order and declining confidence in the dollar system. The 2008 global financial crisis and Russia’s 2022 move to freeze foreign currency reserves shattered the myth of the dollar and US Treasuries as risk-free assets. Central banks worldwide are now acting as “value-conscious buyers,” not just purchasing gold but viewing it as a strategic asset.

Between 2022 and 2023, global central banks bought over 1,000 tons of gold—an unprecedented amount. This demand isn’t driven by market forces but by government policies. The rise in US and Chinese stock markets reflects how governments are actively directing capital flows through full industry nationalization policies.

The US “Chips and Science Act” has elevated AI and semiconductor industries to a national security level. Similarly, China’s initiatives are funneling funds into independence and military industries. In this era of industry nationalization, capital is flowing out of big tech and into government-supported sectors. Companies like NVIDIA and Palantir are increasingly reliant on government contracts and security aid, while stock markets benefiting from these policy-driven flows. Meanwhile, Bitcoin, without government backing or a national security mission, is losing out in this capital allocation game.

Historical Pattern: Is Bitcoin’s Recovery Beginning?

But history tells a different story. Bitcoin’s relative strength index (RSI) against gold reveals a historic pattern. In 2015, 2018, 2022, and now 2025–2026, Bitcoin has entered oversold territory four times. Each time, this oversold condition has foreshadowed a strong rebound.

At the end of 2015, when Bitcoin was oversold relative to gold, it marked the start of the 2016–2017 super cycle. In 2018, Bitcoin fell over 40% while gold rose only 6%. After RSI dipped below 30, Bitcoin recovered from its 2020 lows by 770%. During the 2022 bull market, Bitcoin dropped as much as 60%, but after RSI exited oversold levels, it experienced a powerful recovery in early 2024 and 2025.

Now, since late 2025, we see this historic oversold signal for the fourth time. Gold has increased 60% in 2025, and Bitcoin’s RSI against gold has again entered oversold territory. According to this pattern, a strong recovery could be on the horizon.

Asset Rebalancing and Future Outlook

The current market situation presents a unique moment. On one hand, asset valuations are at extreme levels, investor optimism has reached its highest since July 2021, and cash holdings are at their lowest. On the other hand, geopolitical conflicts are escalating. Analysts like the German bank and Ray Dalio of Bridgewater Associates have identified artificial intelligence markets as the biggest risk in 2026. Star companies like NVIDIA and Palantir have reached historic highs, raising questions about whether their earnings growth justifies these valuations.

In this context, Bitcoin’s “stability” is not just a retreat but a warning sign. It signals a gathering strength before a larger market upheaval. For long-term investors, it’s a test of faith and a time to wait for future opportunities. In this era of state-led industry nationalization and global economic reshuffling, Bitcoin’s position is becoming a form of strategic reserve—waiting before a major rebalancing.