27th November 2025 – (Hong Kong) Screens turned red again on Wednesday as sentiment soured across digital assets. Bitcoin retreated from six‑figure peaks to the $86,000-$87,000 range, spot Bitcoin exchange-traded funds flipped from record inflows to record redemptions, and more than $2.5 billion exited U.S. spot Bitcoin ETFs in November. BlackRock’s iBIT logged its largest single-day outflow since launch, fuelling headlines that the “institutional era” was illusory.
Each cycle lifts prices on narratives that thrive in a bull market, only for a sharp correction to expose their fragility. Bear markets have not ended crypto; they have dismantled myths that never merited the capital they drew.
The 2018 collapse served as the sector’s first audit, with Bitcoin falling over 80% from its late‑2017 high as the ICO boom imploded and thousands of token sales without products or governance unwound. That period is now widely viewed as a clearance of unregistered securities masquerading as “community ownership” rather than an existential failure.
March 2020 followed a similar script. Amid the COVID panic, Bitcoin shed more than a quarter of its value in a day and halved within 48 hours as leveraged venues such as BitMEX liquidated positions en masse. The market then rebounded faster than any major asset class. The episode discredited the notion that a durable financial system could rest entirely on cross‑exchange leverage.
In 2022, the market turned inward. TerraUSD’s algorithmic stablecoin collapsed, erasing roughly $40-$45 billion and proving that formulas cannot substitute for reserves; its founder has since pleaded guilty to fraud. FTX’s implosion revealed a $32 billion exchange operating like a leveraged hedge fund with a marketing budget, triggering contagion across lenders and funds that had chased “risk‑free yield”.
Each time, predictions of crypto’s demise were followed by quiet advances. Post‑2018 brought regulated custody and institutional derivatives. After 2020, Bitcoin took on a macro role on corporate balance sheets. Post‑2022, policymakers accelerated work on frameworks for stablecoins and tokenised assets.
The current downturn is cutting away a different set of stories: the claim that meme coins, celebrity tokens and “AI‑themed dog money” define the industry. In 2024, meme coins peaked around $137 billion in market value before falling to roughly a third as insider selling and political tokens unravelled, dragging on Bitcoin and Ether. The 2025 reprise proved harsher, with new tickers tied to politics and AI trends saturating the market with unsustainable economics; some popular tokens would require market capitalisations larger than global equities to reach touted price targets — a fantasy, critics argue.
When volatility spikes, these narratives are the first to fail. The $1.2 trillion erased from crypto’s capitalisation and record ETF outflows speak less to blockchain’s weakness than to excess leverage layered atop it. Traders who chased meme‑themed ETFs and high‑beta altcoins are now heading for the exits.
Beneath the noise, the rails continue to expand. Stablecoins have grown from a $5 billion curiosity to a settlement layer exceeding $300 billion in circulation, processing trillions in annual volume. Some analysts estimate stablecoin transactions reached about $32 trillion in 2024, including roughly $5.7 trillion cross‑border. To many, this is the scaffold of next‑generation payments rather than a speculative sideshow.
Tokenisation is tracing a similar arc. Industry estimates place real‑world asset tokenisation in the tens of billions today, growing at more than 60% annually with projections into the trillions by 2030, shifting from pilots to systemic use. BlackRock’s BUIDL — a tokenised US dollar liquidity fund — has surpassed $2.5 billion and is accepted as collateral on major exchanges, signalling a portion of short‑term fixed income is quietly moving on‑chain.
The gap between headlines and usage is widening. While retail capitulates on meme assets, small and medium‑sized enterprises are using stablecoins to pay suppliers, settle invoices within minutes and hedge FX risk without banking delays. Treasury teams at fintechs are holding tokenised Treasury bills and money‑market funds as programmable collateral. These applications may be unglamorous, but they are resilient to price cycles.
Bear markets operate as product reviews, compelling builders to justify the existence of their tokens and to demonstrate usage even if prices halve again. They also retire failed narratives: “risk‑free” 20% yields were buried with Terra; blind trust in centralised wunderkinds ended with FTX. The present phase is dismantling the notion that every celebrity or canine coin deserves capital.
Weekend dollar settlement; programmable versions of familiar instruments; cross‑border transfers that complete in minutes. Yet these are precisely the use cases reshaping global finance. With cross‑border payments estimated by central banks and the IMF at around $1 quadrillion in 2024, shaving a few basis points from costs dwarfs the economic relevance of meme assets. Researchers increasingly cite blockchain rails as a credible route to deliver those efficiencies.
Will this bear market “finally” end crypto? Unlikely. It will cull narratives that lost credibility as liquidity receded. It will not halt the pipes already moving trillions or the tokenisation stacks being adopted by major financial institutions. The real risk is squandering the reset by reviving the same hype. If builders, investors and regulators lean into the audit, the next upswing will be driven less by cartoons and leverage and more by stable, programmable infrastructure integrated into mainstream finance.
