Bitcoin Hits $111K Then Faceplants to $104K: A Masterclass in How to Make Everyone Rich and Poor Simultaneously

Cold Open

Bitcoin managed to hit $111,889 in May before promptly remembering it's supposed to be volatile and dropping to $104K by month's end, which is basically the financial equivalent of your drunk uncle bragging about his marathon time before face-planting into the wedding cake. The only thing more predictable than Bitcoin's price swings at this point is the army of analysts explaining why they totally saw it coming.

The Setup (What Actually Happened)

May 2025 will go down in crypto history as the month Bitcoin achieved the impossible: making both HODLers and traders equally miserable through the sheer audacity of doing exactly what Bitcoin always does—going up until it doesn't.The month started with what Chainalysis called "the strongest accumulation phase since January," which is analyst-speak for "whales are buying and we're all pretending this means something profound about market psychology." Bitcoin whales—those holding over 10,000 BTC¹—led accumulation from April into early May, but as prices climbed past $107,000, these large holders began reducing their exposure while smaller investors continued accumulating like they were collecting Pokemon cards.By May 21, Bitcoin had officially eclipsed its previous all-time high, hitting $111,889 amid what analysts called "improved risk sentiment following April's tariff-induced selloff." Translation: people stopped panicking about trade wars long enough to remember they were supposed to be panicking about inflation instead.But then—plot twist!—renewed US-China trade tensions flared up by month's end, sending Bitcoin tumbling below $104,000 faster than you can say "safe haven asset." The CoinDesk 20 index declined 4.2% as crypto Twitter collectively remembered that correlation with traditional markets is actually a thing, despite years of insisting Bitcoin was "digital gold" and "uncorrelated to legacy systems."

The Breakdown (Technical Analysis with Snark)

Here's where things get beautifully absurd from a technical standpoint. While Bitcoin was busy making millionaires and destroying dreams, the underlying network infrastructure was having its own little party. Mining difficulty hit a record 126.95 trillion—a 4% increase that would make gym bros jealous of Bitcoin's commitment to making everything harder.The seven-day average hashrate climbed from 840 EH/s to 918 EH/s, approaching the previous peak of 925 EH/s. For those keeping score at home, this means we're burning enough electricity to power Portugal² to secure a network where transaction fees are sitting at a whopping $0.30. It's like hiring a thousand bodyguards to protect a lemonade stand.This creates what I like to call the "Bitcoin Infrastructure Paradox": the network is becoming more secure and expensive to attack at exactly the moment when most people are using it to speculate on Pepe derivatives and argue about whether $100K is "the new floor."BlackRock's iShares Bitcoin Trust saw record monthly inflows of over $6.2 billion, pushing total assets under management beyond $71 billion. Apparently, institutional investors looked at Bitcoin's volatility and thought, "You know what our carefully balanced portfolios need? More of whatever this is."Meanwhile, Standard Chartered's Geoffrey Kendrick maintained his $500,000 BTC price target, claiming "all predicted market drivers were working simultaneously." His roadmap: $120K by Q2 end, $200K by 2025 end, and $500K by 2028. It's refreshingly specific for predictions that essentially amount to "number go up because reasons."SIMON'S SIDEBARThere's a Vietnamese saying: "Có công mài sắt có ngày nên kim"—with effort, iron can be ground into a needle. Bitcoin miners are literally grinding electricity into mathematical needles, except these needles cost $50,000 each and their value changes every time someone tweets about China. I'm not sure this is what my grandmother had in mind, but here we are.