Why American Bitcoin (ABTC) Is Underperforming Despite a Rallying BTC Price

The recent divergence between American Bitcoin (ABTC) and Bitcoin (BTC-USD) has sparked intense debate among investors. While BTC-USD surged 4% in mid-November 2025, reaching highs above $93,500, ABTC plummeted by 30% in the same month, marking a 34.5% year-to-date decline. This stark contrast raises critical questions about valuation misalignment and technical breakdowns in a volatile sector.

Valuation Misalignment: A Tale of Two Assets

ABTC's valuation metrics reveal a stock grappling with market skepticism. Despite a price-to-earnings (PE) ratio of 23.4x to 26.5x-below the software industry average of 29.8x to 32.1x-investors remain wary of its earnings potential. This undervaluation, however, is juxtaposed with a discounted cash flow (DCF) model suggesting the stock is overvalued at $4.20, above its estimated fair value of $3.11. Such contradictions highlight a fragmented market perception: while some see a bargain, others view ABTC as a speculative liability.

Meanwhile, BTC's stability-posting a 2.54% YTD return-underscores its role as a store of value amid macroeconomic uncertainty. ABTC's higher volatility (daily standard deviation of 227.09% vs. BTC's 35.30%) and maximum drawdowns (-100% vs. -93.18%) further amplify its risk profile. In a sector where institutional confidence is paramount, ABTC's inability to align with BTC's resilience exposes structural weaknesses.

Technical Breakdown: Mixed Signals and Bearish Sentiment

Technical analysis of ABTC reveals a stock in disarray. The 14-day RSI oscillates between conflicting signals: a bullish 63.003 in one report and a bearish 36.81 in another. Similarly, the 50-day and 200-day moving averages ($4.933 and $5.163, respectively) suggest a "Buy" signal, yet the 50-day MA crossing below the 200-day MA in the 1-week timeframe indicates a bearish trend.

The broader technical outlook is equally grim. A "strong sell" rating aggregates multiple indicators, including oscillators and moving averages, while the Fear & Greed Index for ABTC sits at 23-"extreme fear"-with 60% of signals bearish. This contrasts sharply with BTC's rally, which was supported by spot buying and a consolidation band between $80,000 and $105,000. ABTC's lack of such structural support underscores its vulnerability in a sector increasingly dominated by crypto-native assets.

BTC's Rally and ABTC's Disconnection

Bitcoin's November 2025 rally, fueled by retail-driven spot buying and a well-defined order block in the $88,400–$91,500 range, did little to buoy ABTC. The stock's technical indicators-including a 1-week RSI of 0.00-suggest bearish momentum, even as BTC's on-chain metrics pointed to institutional strength. This disconnection highlights a critical issue: ABTC's performance is decoupled from the broader crypto ecosystem. Unlike BTC, which benefits from macroeconomic tailwinds and institutional adoption, ABTC remains tethered to the volatile fortunes of the stock market, where earnings skepticism and sector rotation dominate.

Implications for Investors

The misalignment between ABTC and BTC reflects deeper sectoral divides. While BTC's rally is underpinned by its role as a hedge against inflation and a digital reserve asset, ABTC's struggles stem from its hybrid identity-a stock mimicking a crypto asset. This duality leaves it exposed to both equity market volatility and crypto-specific risks, such as regulatory uncertainty and technological obsolescence.

For risk-adjusted returns, ABTC's Sharpe ratio (0.14) and Sortino ratio (2.35) outperform BTC's -0.11 and 0.14, but these metrics mask the stock's extreme drawdowns. Investors must weigh ABTC's potential for undervaluation against its technical fragility and sectoral headwinds. In a market where sentiment shifts rapidly, ABTC's path to recovery may require not just a BTC-driven rally but a fundamental re-rating of its business model.

Conclusion

American Bitcoin's underperformance amid BTC's rally is a cautionary tale of valuation misalignment and technical breakdown in a volatile sector. While BTC benefits from macroeconomic tailwinds and institutional demand, ABTC remains a speculative asset burdened by earnings skepticism and structural volatility. For investors, the key takeaway is clear: in a market increasingly defined by crypto-native assets, hybrid models like ABTC face an uphill battle to justify their place.