Analysts say the market remains fragile. Jean-David Pequignot, chief commercial officer at Deribit, noted that despite the rebound, short-term risks remain tilted to the downside. Still, he added that past extreme selloffs have sometimes offered opportunities for investors willing to take bold positions.
Industry data shows the scale of the recent pullback. Roughly $1.2 trillion has been wiped from the value of all cryptocurrencies in just six weeks, according to CoinGecko. Traders point to fading confidence in imminent U.S. interest-rate cuts, a broader risk-averse turn in global markets after a prolonged rally, and the rapid unwinding of leveraged positions.
Joshua Chu of the Hong Kong Web3 Association said the downturn has been compounded by institutions and listed firms unwinding positions built during earlier bullish periods. “When support thins and macro uncertainty rises, confidence can erode with remarkable speed,” he said.
Another pressure point has been sustained outflows from U.S. spot bitcoin ETFs. Since Oct. 10—when equity markets tumbled on renewed U.S.-China tariff concerns—these ETFs have seen $3.7 billion in withdrawals, including $2.3 billion in November alone, Morningstar data shows. Joseph Edwards of Enigma Securities said speculative investors who bought in expecting favorable U.S. regulation have been stepping back, contributing to selling pressure. He added that retail demand has weakened since last month’s flash crash, which triggered $19 billion in leveraged liquidations.
The cooling sentiment has weighed on crypto-exposed equities such as Strategy, Marathon Holdings, and Coinbase. These stocks fell in tandem with bitcoin but later rebounded in afternoon trading as the token recovered.
One area drawing increasing scrutiny is the surge in public companies acting as “crypto treasuries”—firms in unrelated industries buying digital assets for their balance sheets. Standard Chartered estimates that a slide below $90,000 could leave about half of these companies’ bitcoin holdings underwater, meaning worth less than their purchase price. According to the bank, listed firms now hold 4% of bitcoin and 3.1% of ether in circulation.
The largest corporate holder, Strategy, has continued buying despite the downturn. Founder Michael Saylor said the firm acquired 8,178 bitcoin on Monday, bringing its total to 649,870 tokens held at an average purchase price of roughly $74,433 per coin.
Ethereum has not been spared either. Ether has been under sustained pressure and is now down nearly 40% from its August high above $4,955, reflecting the broader loss of momentum across the digital-asset landscape.
While bitcoin’s modest rebound offers a momentary respite, traders caution that sentiment remains fragile, with macro uncertainty and thinning liquidity still shaping the path ahead.