The crypto futures market faced $1.7 billion in liquidations as Bitcoin approached dangerous price levels.
Bitcoin saw a significant plunge on Friday, dropping rapidly toward the mid-$80,000 range, with prices touching around $82,000 at mid-day UTC, marking a sharp decline of over 4.5 percent on the day alone and more than 20 percent losses over the past month. This selloff represents Bitcoin’s worst month since the steep declines that began earlier in the year, wiping out much of the year’s gains and contributing to a broader crypto market downturn that saw over $1 trillion erased in value recently.
This latest crash was triggered by a combination of factors, including panic selling prompted by Japan’s massive stimulus package, which spooked multiple asset markets globally. The package raised investor fears over monetary policy and currency impacts, which in turn pressured risk assets like Bitcoin. On top of this macroeconomic headwind, fresh waves of holdings from dormant wallets moving coins to exchanges overwhelmed demand, exacerbating the decline as traders scrambled to liquidate positions.
Derivatives data from key platforms like Deribit showed a notable shift in market sentiment, with put options at the $85,000 strike becoming the largest open interest in BTC options, superseding higher call strikes, indicating traders are hedging for more downside. Liquidations in the crypto futures market hit approximately $1.7 billion as Bitcoin rapidly neared the $80,000 mark, intensifying bearish pressure. This liquidation cascade reflected a market under strain from deteriorating technical indicators and increased uncertainty over future rate hikes by the U.S. Federal Reserve.
Read more: Bitcoin dips below $100,000 amid major selloff, over $2 billion in liquidations
Throughout November, Bitcoin faced a strong bearish momentum that erased gains made earlier in 2025 when the price peaked above $126,000 in October. This steep correction brought Bitcoin down below $90,000 for the first time in seven months mid-November and pushed it dangerously close to levels last seen in the spring. The broader cryptocurrency market similarly suffered, with altcoins like Dogecoin also crashing below critical support levels, reflecting a widespread loss of confidence among investors.
Some analysts and market participants suggested that the crash was partly fueled by technical factors, including large-scale movements of BTC from long-dormant wallets transferring tens of thousands of coins to exchanges, placing substantial selling pressure on an already fragile market. Additionally, some observers pointed to software glitches and suspected market manipulation as contributors to the extreme price swings seen on November 21, which accelerated the decline abruptly within hours.
Despite the bearish conditions, there were some moments of relief as prices briefly recovered following strong earnings and revenue forecasts from major technology firms like Nvidia, which partly alleviated concerns about a broader slowdown in AI spending and tech sector weakness. However, this relief was short-lived as Bitcoin’s fundamental outlook remains fragile heading into the end of the year, with liquidity thinning and risk appetite waning among investors.
The market remains focused on critical psychological support levels of $85,000 and $80,000, with the April 2025 trough around $74,425 serving as the ultimate downside target for many traders monitoring the bear trajectory. Investors and traders are positioning themselves defensively, focusing on protecting existing profits rather than seeking new exposure, as macroeconomic uncertainties, including the pace of interest rate hikes and global geopolitical risks, continue to weigh heavily on sentiment.
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