November 14 opened with a gray tone across global financial markets as US equities turned red and the crypto market plunged after an extended period of overheated gains. Total crypto market capitalization dropped more than 2 percent and fell to 3.35 trillion USD which is the lowest level since the start of Q4 2025. The main focus is Bitcoin closing its first daily candle below the psychological level of 100,000 USD after holding this threshold for 188 consecutive days since May 2025.
1.Market Overview
Bitcoin continues to fall and dropped below 98,000 USD for the second time this week which highlights the fragility of the market as forced liquidations and heavy selling pressure from long term holders keep increasing.
BTC is currently closing below 98,200 USD which is the same low seen in late June and may retest the 88,000 to 92,000 USD support range from April if buying demand does not step in. The 50 day EMA is turning toward the 200 day EMA which signals a possible death cross while RSI is approaching the oversold zone and MACD has crossed below the signal line which reinforces the bearish trend.
This deep decline has triggered a new wave of liquidations across the market. According to Coinglass, more than 1.3 billion USD was wiped out in the last 24 hours and long positions accounted for 1.1 billion USD. Clearly most traders were positioned for upside.
CryptoQuant shows that addresses holding BTC for more than six months have sold about 815,000 BTC in the past 30 days which is the highest level since January 2024.
Charts reveal continuous distribution from cohorts holding BTC from 6 months to more than 7 years which creates prolonged oversupply at the current price level.
This selling resembles previous cycle tops when long term holders took profit after multi month rallies. The pattern is clearly visible on technical charts.
Every spike in BTC spending from long term holders aligns with local price tops and prolonged consolidation phases. The current selloff of 815,000 BTC is similar to the heavy distribution seen at the peaks of 2021 and early 2024.
Analysts emphasize that long term holders have a far greater impact on market structure than short term trading noise. When old wallets move large amounts of BTC back into circulation, liquidity improves but price support weakens.
Combined with the largest liquidation cluster of the week, the market is facing forced selling and voluntary selling at the same time which magnifies the decline.
2.Macro Factors
2.1 Interest Rate Conditions
On November 5, 2025, Fed Chair Jerome Powell stated that the Federal Reserve has no plan to cut rates in December and must keep rates higher for longer. This immediately pushed the US Dollar Index up 1.4 percent and the 10 year Treasury yield surged to 5.1 percent which is the highest level since August. In this environment global capital exits risk assets which include tech stocks and crypto.
At the same time Nasdaq and the S&P 500 posted four consecutive red sessions led by AI and high tech stocks. This reflects broad systemic risk sentiment. When short term returns shrink investors must de risk across all asset classes. Crypto which is a high liquidity and fast reacting market becomes the first pressure release valve in a risk off cycle.
2.2 Outflows From ETFs
In the latest trading session US spot Bitcoin ETFs saw 866.7 million USD withdrawn which is the second largest outflow ever after the record 1.14 billion USD on February 26. This mass withdrawal is not random. It signals a clear shift in institutional sentiment from risk on to risk off. Large asset managers are moving to cash and Treasuries while waiting for macro conditions to stabilize before returning to risk assets.
This shift aligns with a 2 percent drop in the Nasdaq 100 and shows a widespread defensive mindset.
Over the last three weeks total outflows from Bitcoin ETFs reached 2.64 billion USD which highlights extreme caution from institutions. The largest outflows came from:
- Grayscale Bitcoin Mini Trust: 318.2 million USD
- BlackRock IBIT: 256.6 million USD
- Fidelity FBTC: 119.9 million USD
Other funds such as GBTC (Grayscale), Ark, 21Shares, Bitwise, VanEck, Invesco, Valkyrie and Franklin Templeton also recorded notable outflows.
After more than one year since spot ETFs launched this downturn shows that institutions are no longer blindly allocating to BTC and ETH. They are shifting strategies and searching for new opportunities and Solana is emerging as a prime destination.
While Bitcoin and Ethereum ETFs are experiencing heavy outflows Solana ETFs recorded 370 million USD in net inflows which reflects a change in investment preferences.
Large institutions view Solana as having clear technological advantages such as high throughput, low fees and strong potential for real world asset tokenization and staking yield. In other words, the market is not collapsing. It is restructuring. Outflows from BTC and ETH are driven not only by macro fear but also by the formation of a new cycle where investors rotate into platforms with real utility and real yield instead of symbolic value.
3.Market Instability
3.1 Stream Finance and Curators: concentrated power collapses a stablecoin
2025 witnessed a major shock when Stream Finance, the issuer of the xUSD stablecoin, collapsed due to its curated vault model. xUSD was marketed as high yield and safe but curators had full authority to adjust vault risk with no oversight.
Curators were caught using high leverage, reusing xUSD collateral in looped yield strategies and deploying untested tactics. When the market swung sharply in June 2025, mass withdrawals caused xUSD to lose its peg and fall to 0.85 to 0.9 USD. Euler and Morpho had to freeze related vaults which left users stuck.
The incident revealed a structural weakness. Curated vaults operate almost like disguised CeFi where curators hold full power with little transparency which violates core DeFi principles. The Stream ecosystem quickly collapsed as liquidity drained and related assets such as mHyper dropped sharply.
The broader impact was a market wide debate about permissionless vaults and curator authority which forced many protocols such as Elixir and Gearbox to re evaluate their risk frameworks.
3.2 Balancer hack: a small mathematical error causes 128 million USD in losses
On November 3, 2025, Balancer V2 was exploited through a rounding error in the _upscaleArray function. The attacker used batchSwap to manipulate exchange rates and drained assets from multiple Composable Stable Pools.
Total losses reached 128 million USD with only 19 million recovered. Pools containing osETH, wstETH and WETH suffered the worst damage. Balancer TVL dropped more than 50 percent and triggered a domino effect across Curve, Morpho, Aura and Euler as users panicked and pulled liquidity.
Even though Balancer had undergone multiple audits a tiny mistake was enough to break its pricing mechanism. This raised a difficult question. Is DeFi optimizing too aggressively for efficiency at the cost of safety?
4.Conclusion
The early November 2025 decline is not a temporary shock but a self correction of a market that expanded too fast. With the Fed maintaining high rates institutional capital is exiting risk assets which turn Bitcoin from digital gold into a victim of monetary policy. Macro pressure and an overloaded leverage structure combined with skewed funding wiped out more than 2 billion USD in positions in a single day and triggered a domino effect across the market.
At the same time two major DeFi incidents, the Stream Finance curator scandal and the 128 million USD Balancer hack, erased the last bit of remaining confidence. Audited protocols proved fragile and decentralized mechanisms ended up operating like disguised CeFi.
Disclaimer: This content does not constitute investment, tax, legal, financial or accounting advice. MEXC provides this information for educational purposes only. Always do your own research, understand the risks and invest responsibly.
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