Bitcoin (BTC) clawed back from $86,286 on Dec. 2 to $93,324 as of press time, up by 8%, while the Trump family’s American Bitcoin (ABTC) shares tumbled.
The BTC price increase can be attributed to improved macro conditions and Vanguard’s opening of crypto ETF access to tens of millions of clients.
At the same time, American Bitcoin, the Trump-linked mining stock pitched as a Bitcoin proxy, cratered as much as 50% intraday on volume about ten times normal, triggering repeated trading halts before settling around 35% lower.
The stock now sits about 80% below its September peak of $9.40, even as the asset it’s supposed to track staged a textbook relief rally.
The moves ran in opposite directions because they responded to entirely different catalysts.
Bitcoin bounced because the macro tide turned back in its favor, with the Fed’s quantitative tightening ending, rate-cut odds rising, and ETF distribution channels widening. ABTC dumped because a wall of new stock hit a tiny, hype-driven float all at once as the first major lock-up expiry freed pre-merger and private-placement shares.
The “proxy trade” broke because those two stories have almost nothing to do with each other over a 24-hour window.
The divergence exposes what happens when a levered, politically branded equity wrapper stops behaving like the thing it’s supposed to track. For months, ABTC traded as if it were a synthetic Bitcoin bet with a Trump-family premium baked in.
Then the lock-up expired, early investors dumped, and the proxy trade proved to be exactly that: a trade, not a synthetic ETF.
How Bitcoin clawed back toward $93,000
Bitcoin rebound can be tied to the Fed formally ending quantitative tightening and futures markets now pricing an almost 90% chance of another rate cut at the Dec. 10 FOMC meeting.
That shift eased the “macro shock” that had just knocked BTC below $90k. At the same time, a second narrative tailwind arrived from the ETF channel. Vanguard, which was a big anti-crypto holdout, reversed course and opened access to Bitcoin and other crypto ETFs for its tens of millions of clients.
Despite these developments not changing Bitcoin’s float or capital structure, they change how much people are willing to pay for the same 21 million-cap asset.
The price moved because the macro backdrop improved and distribution channels widened, not because anything fundamental shifted in the network itself.
Why ABTC slumped anyway
American Bitcoin is structurally different. It’s a majority-owned Hut 8 subsidiary that mines BTC and runs a “Bitcoin accumulation” balance-sheet strategy, with several thousand BTC on its books and a mandate to build a US-centric mining and treasury platform.
That setup encouraged traders and some commentators to pitch ABTC as a “Bitcoin proxy” or even a kind of Trump-branded mini-Strategy.
As part of going public, the company sold privately issued stock to raise about $220 million, with insiders explicitly stating they expected it to trade as a Bitcoin proxy.
The crash, though, was about the supply of shares, not the hashpower or the BTC price. The Dec. 2 plunge coincided with the first major lock-up expiry for pre-merger and private-placement shares.
As those previously restricted blocks became freely tradable, early investors dumped stock into the open market, sending ABTC down roughly 35% to 50% intraday, on volume about 10 times normal, and triggering repeated trading halts.
Management is openly framing it as a technical event. American Bitcoin president Matt Prusak told investors on X that the team “expected the next few days to be choppy as those shares find new homes.”
Meanwhile, Reuters reported that Hut 8, Eric Trump, and Donald Trump Jr. say they did not sell into the unlock and continue to hold. But whether or not insiders sold is almost beside the point: tens or hundreds of millions of dollars’ worth of previously caged stock just hit a thin float in one shot. That’s why ABTC sank even as BTC was bouncing.
Why the “proxy trade” cracked
Three structural forces broke the ABTC/BTC link on this move, and none of them resolved quickly.
First, the float changed, but Bitcoin’s didn’t. BTC’s circulating supply is predictable and changes slowly. ABTC’s free float just jumped with the unlocking of pre-merger and private placement stock.
That floods the order book with sellers who paid much lower prices months ago and are happy to take profits or de-risk, regardless of what BTC does on a given day.
The result is exactly what the market saw: Bitcoin up in the mid-single digits, the proxy down by almost half.
Second, ABTC carries equity-specific and Trump-specific risk that Bitcoin itself doesn’t. Trump-linked crypto ventures, such as memecoins like TRUMP and MELANIA, are down more than 90% from their peaks.
Additionally, Trump Media & Technology Group has lost over 60% of its value this year, and ALT5 Sigma, which holds tokens in another Trump crypto venture, is down by a similar margin and under SEC scrutiny.
When the “Trump crypto complex” is in free fall, ABTC stops trading as a pure macro Bitcoin bet and becomes a political and governance story.
Third, miners are levered, idiosyncratic wrappers even in normal times. ABTC’s business is a leveraged play on hash price, power costs, execution, and financing terms, wrapped in a small-cap stock that just came public via a reverse merger.
A lock-up expiry in that context magnifies every other concern: investors worry about dilution, overhang, insider incentives, and the possibility that early backers know something they don’t.
On one side of the chart, BTC has just staged a textbook macro relief rally: Fed QT is over, rate-cut odds are rising, Vanguard finally opened its doors to crypto ETFs, and flows into spot products have turned positive again.
On the other side, ABTC is digesting an entirely different shock: the first wave of locked-up Trump-linked miner stock hitting a thin float all at once, in a sector where sentiment toward crypto equities and Trump-brand tokens is already brittle.
That gives a clear explanation for the divergence: the proxy broke because it was never really Bitcoin in the first place.
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