Bitcoin Drops Below $86K as Crypto Market Bleeds $200B

Remember when Bitcoin was knocking on $100K just a couple of weeks ago and everyone was calling for $150K by Christmas?

Yeah… about that.

Today, November 21, 2025, the entire crypto market woke up to a bloodbath. Bitcoin sliced clean through the $90K support like it wasn’t even there and kept falling until it found temporary shelter around $85,300. Ethereum got absolutely wrecked, losing almost 8% in a single day. Solana, XRP, the meme coins – nothing was spared. Almost a billion dollars in leveraged positions turned to dust before most people even had their morning coffee.

I’ve been through enough cycles to know one thing for sure: these days hurt. But they also tell us a hell of a lot about where we really are in the grand scheme of things.

The Damage Report: Numbers That Make You Wince

Let’s not sugarcoat it – this was ugly.

The total crypto market capitalization fell below the psychological $3 trillion mark for the first time since early May. At the worst point today we were staring at $2.92 trillion before a tiny dead-cat bounce brought us back near $2.95 trillion. That’s roughly $200 billion wiped out in less than 24 hours. For context, that’s more than the entire market cap of Cardano, Avalanche, and Tron combined – gone in a single session.

Here’s how the major players closed the day:

And the meme coin casino? Absolute carnage. PEPE down 8.3%, BONK -6.6%, dogwifhat -7.3%. Even the cats weren’t safe – Popcat dropped over 5%.

Liquidations: Nearly a Billion Gone in a Blink

The real story, though, isn’t the price action itself – it’s the forced selling behind it.

Data shows $958 million in positions liquidated across all exchanges in the past 24 hours. That’s the highest single-day liquidation number since the August 5 cascade. Longs got absolutely crushed – roughly 87% of the wiped positions were bullish bets. Open interest across the futures market dropped 7% overnight, now sitting at $133 billion. When OI falls that fast alongside price, you know the deleveraging is brutal.

I’ve watched these events enough times to spot the pattern. When the market gets this over-leveraged (and yes, it absolutely was), any external trigger can start a chain reaction. One big player gets margin-called, forces a cascade of stop-losses, and suddenly everyone’s racing for the exit at the same time.

Sentiment Hits Rock Bottom – Literally

The Fear and Greed Index is flashing “Extreme Fear” at 14 – up two points from yesterday, which somehow feels worse. When even the slightest bounce in the index happens during a day like this, you know things are bad.

Social media is the usual mix of capitulation posts, “I told you so” from the bears who’ve been wrong for two years straight, and the occasional diamond-handed HODLer reminding everyone that Bitcoin has survived worse.

“Every cycle has a moment where it feels like it’s over. This is that moment. And just like every other time, it’s probably not.”

What Actually Triggered This Mess?

There’s never just one reason, but a few things clearly lined up.

• Lingering scars from October’s liquidity crunch. That flash crash on the 10th wiped out $19 billion in positions and left a lot of market makers nursing wounds. Many are still deleveraging and reducing risk six weeks later.
• Macro headwinds getting worse. Sticky inflation numbers have pushed rate-cut odds for December down sharply. Higher-for-longer is poison for risk assets.
• Rotation out of “2024 winners.” Money has been flowing from crypto and AI names into old-school tech and semiconductors. When the narrative shifts, the pain is real.
• Spot ETF outflows. Over $4 billion has left Bitcoin and Ethereum ETFs since the start of November – the worst streak since February.

Add all that together and you’ve got the perfect recipe for a sharp, painful correction.

Is This the End of the Bull Market?

Short answer? Probably not.

Long answer? Let’s look at history.

Every major Bitcoin bull run has had mid-cycle corrections of 20-40%. The 2017 run had multiple 30%+ drawdowns. 2021 saw three separate 30-50% drops before the final top. Even the relatively “clean” 2020-2021 run had a 31% correction in May and another 54% crash after the China mining ban.

We’re currently down roughly 18% from the local high near $103,500. Painful? Absolutely. Cycle-ending? History says no.

“From an on-chain cycle perspective, the bull cycle technically ended earlier this year when Bitcoin touched around $100K. If you are not trading futures and only holding Bitcoin spot, this looks like a reasonable long-term accumulation zone.”

– Ki Young Ju, CEO of CryptoQuant

That’s one of the more interesting takes floating around right now. And on-chain data actually backs it up to some extent – realized price for short-term holders is sitting right around current levels, which has historically been a decent floor during bull markets.

The Case for a Deeper Drop

To be fair, not everyone’s calling for an immediate bounce.

Some analysts point out that long-term holders have barely started distributing. Until that selling pressure eases, we could see more downside. The $80K level is obvious psychological support, but below that things get messy fast – $74K, then the $69K zone from March.

Leverage is still elevated in some corners of the market. Another flush could easily take us lower before any real capitulation sets in.

The Bull Case: This Is the Shakeout We Needed

Here’s what keeps me from panicking.

• Stablecoin supply is still near all-time highs – money is sitting on the sidelines, not gone forever.
• The Fed is still projected to cut rates eventually – just maybe not as soon or as aggressively as people hoped.
• Institutional accumulation continues underneath the surface (look at MicroStrategy, BlackRock holdings, etc.).
• We haven’t seen the kind of euphoric retail inflows that usually mark tops.

VanEck’s latest forecast still calls for a cycle peak in Q1 2026. That would fit perfectly with a shakeout now, consolidation through early 2025, and a final parabolic leg higher once liquidity conditions improve.

What Should You Actually Do Right Now?

Look, I’m not your financial advisor. But I’ve been around long enough to know a few things that have served me well during moments like this:

• If you were over-leveraged, this was your wake-up call. DeFi yields are still decent – maybe park some capital there instead of 20x longs.
• If you’re a long-term holder sitting on spot, days like today are why you don’t sell your coins to trade futures.
• If you have dry powder, current levels are objectively better than two weeks ago. Whether you buy the dip aggressively or dollar-cost average is a personal risk tolerance question.
• If you’re panicking… maybe take a break from price charts for a few days. The market will still be here when you come back.

Cycles are cycles for a reason. The pain is real, but so is the opportunity that comes after the weak hands get shaken out.

We’ve seen this movie before. And spoiler alert: the good guys usually win in the end.

Stay safe out there. The market’s giving us a harsh reminder today that risk management still matters – even in the middle of what might still be the biggest bull market of our lives.