As of November 2025, Bitcoin has declined by more than 25% from its all-time high in October ($126,270). It plunged to below $95,000 for the first time in five months. What started out as a seemingly normal profit taking ultimately became a clear sign of structural exhaustion and loss of momentum in the market.
This downward trend was not caused by a single catastrophic event. It is a combination of interrelated factors. Among them, the first liquidity shock appeared between November 2nd and 4th, triggered by large-scale liquidations in the derivatives market, significant selling by long-term investors, and a significant withdrawal of institutional capital through exchange-traded funds (ETFs).
Regarding the above, these factors compounded each other as exchange order books became thinner and volatility increased, turning the initial sell-off into a deeper and more prolonged correction.
Major price reduction events
The main technical trigger was a wave of liquidations in October that continued into November, with about $19,000 worth of leveraged positions disappearing within 24 hours. This purge significantly reduced open interest in futures contracts, and the lack of liquidity support placed the spot market under further selling pressure.
This microstructural event destabilized the ecosystem by eliminating many participants who relied on high leverage, making prices prone to wild swings.
at the same time, Long-term holders sold about 400,000 Bitcoin in the weeks leading up to and immediately after the correction, contributing to the decline.a volume equivalent to $40,000-45,000 million, depending on the average price for that period. This release of previously illiquid supply reflects structural profit-taking, evidenced by on-chain metrics that show the movement of coins from inactive wallets to exchanges.
Overall, this decline was a result of macroeconomic uncertainty, the exit of institutional investors, lack of liquidity, and changing sentiment among long-term holders, with volatility reignited and Bitcoin acting as a global risk thermometer. Next, let’s unravel each point.
Macro overview: inflation, monetary policy and global risks
Bitcoin’s correction in recent weeks was influenced by a mixed macroeconomic environment that created a certain period of caution. Although the Fed has already emerged from an aggressive rate hike cycle and global M2 liquidity continues to expand, investors have been waiting for new US inflation data (CPI) to be a deciding factor in assessing the speed and magnitude of future rate cuts. This temporary uncertainty reduced risk before the data appeared, especially in volatile assets.
This, combined with the partial paralysis of the US government, delayed the release of key indicators and cast doubt on the stability of public spending in the short term. This delay heightened the perception that the economic outlook was poor and led to an early decline in capital flows into risk products.
capital conservation
In that context, The institutional trend toward Bitcoin, which was one of the main drivers of optimism a few months ago, has begun to slow.. Major operators adjusted their positions before learning the CPI, shifting caution from Wall Street to the market. As a result, we quickly moved from the enthusiasm stage to the capital preservation stage.
Different pressures are adjusted to amplify the movement. The possibility that the pace of rate cuts will slow has raised the cost of holding speculative positions and encouraged profit-taking. At the same time, arbitrageurs and macro funds reduced precautionary exposures, reducing market depth at the same time as short supply increased.
In other words, Bitcoin’s decline was not in response to an overtly bearish macro environment, but rather a temporary adjustment in liquidity and risk expectations. During this period of uncertainty, Bitcoin was one of the first assets to reflect a shift to a more cautious stance on the part of investors.
The November 2025 adjustment came from the spot market, not the derivatives that occurred in October. Bitcoin plunged more than 7% on a significant day on November 3rd.. What started as a technical correction turned into a massive wave of selling indicating a change in market dynamics. Long-term investors who traditionally provided stability to the ecosystem began liquidating their positions.
According to on-chain metrics compiled by Glassnode, these long-term holders have sold nearly 400,000 BTC in the past few weeks. This equates to more than $45 billion, making it one of the largest profit takings recorded this cycle. Most of these coins remained stationary for 6 to 12 months. This reveals that even the most experienced investors recognize the signs of demand drying up.
Weakening institutional support and sustained bearish pressure
In November, institutional investors’ indifference increased selling pressure. Regulated products, including Bitcoin-based ETFs and investment funds, recorded nearly $1 billion in net outflows during the month, according to CoinShares and AInvest. This reflects the rotation of capital into traditional assets due to expectations of monetary policy from the Federal Reserve.
at the same time, So-called “whales” (individual portfolios holding 100-1,000 BTC) have reduced their accumulation rates to annual lows.. Meanwhile, companies holding between 1,000 and 10,000 BTC began to reduce some of their reserves, further weakening support at key technical levels.
Unlike the October crash, this correction was not caused by large-scale derivatives liquidations. According to Coinglass, only $2 billion was settled in the 24 hours on November 7, down from $19 billion in October. However, bearish pressure remained due to an increase in bearish positions opened through put options with target prices between $80,000 and $85,000 each.
Research groups such as On-Chain Data Analysts and Investing predict that if institutional and retail sales flows continue at their current pace, Markets may extend correction phase until April/May 2026constitutes a similar scenario to that observed after the 2021 rally, where Bitcoin took almost half a year to recover its pre-adjustment levels.
Market structure that amplified the decline
The correction in November started in the spot market, but the structure of the Bitcoin market itself caused the decline to deepen. Derivatives, especially perpetual futures, did not start the decline, but their high leverage and sudden fluctuations amplified their impact. funding rate As prices started to fall, they accelerated the exit of their positions.
In the period before the crash, loss funding rate The sustained positive value encouraged the opening of long positions using leverage.. This behavior was typical of euphoric periods, with an excessive concentration of bullish bets that turned into automatic liquidations when the price reversed. In a matter of hours, the market went from over-optimism to a process of forced exits of positions, intensifying the sell-off.
In addition to this effect, there was a noticeable increase in implied volatility. When traders started hedging their positions with options, the cost of protection rose sharply.reflecting a growing awareness of risk. In practice, this meant that price movements were amplified as each correction created new covering and further selling pressure.
On the other hand, liquidity at the key technology level was insufficient to absorb sales volumes. As the price approached the psychological support of $100,000, the thickness of the order book decreased significantly. A medium-sized order was enough to move the price by several thousand dollars. This structural weakness caused buyers to retreat fearing a new downtrend.
Overleverage, low liquidity, and soaring volatility combined to form a vicious cycle that amplified the downside.
On-chain signals and investor behavior
On-chain signals provided a clear reading that the market had stopped trusting in the continuity of the bullish momentum and started protecting itself. In the second week of November, open interest in derivatives fell by more than 25%. This reduction is typical of deleveraging, where leveraged positions are closed and automatic buyers disappear. Lower active leverage increases the strain on the spot market as there are fewer parties to absorb sales.
at the same time, Expectation indicators showed significant changes. For example, the implied volatility index recorded a clear increase. Traders are paying a higher premium for options, indicating that they expect greater volatility and prefer buying protection rather than taking on more risk.
Whale behavior reinforced this trend. Wallets holding between 100 and 1,000 BTC saw their accumulation slow to last year’s lowest levels. at the same time, The agency maintained relatively low demand for regulated products. This withdrawal of traditional buyers created a gap in marginal demand.
In contrast, stablecoin market capitalization increased by about $3.2 billion in one week. This indicates that some capital sought temporary refuge in “standby” liquidity instead of reinvesting in the spot market.
What will the future hold?
The fall in Bitcoin prices is more like a consolidation phase than a structural collapse. In the short term, your assets can fluctuate between $95,000 and $85,000 as supply and demand adjust. This consolidation could last into the second quarter of 2026 if institutional capital flows do not return and selling pressure continues.
Current levels are consistent with an area of volume where buyers and sellers are redefining value and creating a dynamic balance. However, the institutional flows that fueled the previous rally are showing signs of slowing, making a strong move unlikely until new money flows in.
An active supply distribution indicates that many holders will tend to buy in this range and defend it, creating not only natural support but also a temporary ceiling as we try to recover our costs. If strong inflows into ETFs and funds do not resume and short-term selling pressure continues, the volatility could last for months. Previous cycles have shown that prices take longer to absorb gains after breaking through a local maximum, reflecting the typical stabilization after discounting bullish expectations.
The impact on the market was immediate. Ether fell by 15%, many altcoins fell between 20% and 40%, and illiquid tokens recorded even larger losses. While correlations between assets have increased, managers have rebalanced their portfolios by reducing exposure to BTC and ETH, amplifying capital outflows. Regulated products recorded more than $800 million in weekly outflows, and stablecoin market capitalization increased by nearly 8%, reflecting the move towards precautionary liquidity.
The recovery will depend on the reactivation of net inflows, on-chain stabilization, and macro signals that reduce risk premiums, key factors for Bitcoin to resume its upward trend.
(Tag translation) Bitcoin (BTC)
