Last Thursday morning I got a text from my neighbour: “Dude, what’s going on with Bitcoin?” I glanced at my phone and winced. $82,000. Down from $126,000 in just six weeks. That’s a 35% haircut, folks. Why is Bitcoin dropping so hard? Well, grab some coffee because this story has more layers than you’d think.
The Damage Report
The price of Bitcoin reached $126,000 in October. People were popping champagne. Then reality showed up uninvited. By Nov. 21, Bitcoin had sunk to about $80,000-$81,000, its lowest price since April. It’s not just a bad day at the office; that’s your portfolio being taken to the cleaners.
The Bitcoin price USD is trading around $86,000-$87,000 following that visit to the lows. A recovery is what some are calling it. Others are saying it’s more of a dead cat bounce. Time will tell who’s right.
Bitcoin Crash: The Money That Left the Building
Here’s where things get interesting. You know those Bitcoin ETFs everyone was so excited about? The ones that were supposed to bring Wall Street money into crypto and make everything legitimate? Yeah, well, they just became the exit door.
Investors yanked nearly $1 billion from Bitcoin ETFs in a single session — the second-biggest daily exodus since these things launched. BlackRock’s flagship IBIT fund saw a record single-day outflow of $523 million. That’s not retail investors panic-selling $500 worth of Bitcoin. That’s institutional money heading for the hills.
November has already racked up $3.79 billion in ETF withdrawals, making it the worst month on record. When the big players start running, smaller fish tend to follow.
My buddy who works at a hedge fund put it this way: “Nobody wants to be the last one holding the bag when the music stops.” Harsh, but that’s Wall Street.
The Federal Reserve Threw Cold Water on Everything
Remember when everyone thought interest rate cuts were coming soon? Fed rate cut expectations have dropped from near certainty to about 50%. That matters more than you might think.
When rates stay high, money flows into safe stuff like Treasury bonds. Why gamble on Bitcoin when you can get a decent return on something backed by the U.S. government? It’s not sexy, but it pays the bills without the stomach ulcers.
The Fed’s basically telling markets, “We’re not here to bail you out.” And markets heard that loud and clear.
Leverage: The Silent Killer
Here’s something most people don’t realize — over $1.9 billion in bullish futures positions got liquidated in just four hours. That’s what happens when traders borrow money to bet big on Bitcoin going up, and instead it goes down.
The exchange automatically sells their position to cover the loan, which pushes prices down further, which triggers more liquidations. It’s a death spiral.
I watched this happen in 2018, and it’s happening again. People get greedy, use leverage they don’t understand, and then BOOM — they’re wiped out before they can even react.
Bitcoin News That Spooked Investors
Jan van Eck from VanEck suggested Bitcoin might not have enough privacy or encryption for the long run. He mentioned concerns about quantum computing potentially breaking Bitcoin’s security down the road. That’s the kind of Bitcoin news that gets people nervous, even if it’s years away from being a real problem.
When a major asset manager starts publicly questioning Bitcoin’s foundation, people pay attention. Not everyone sold because of it, but it added to the pile of worries.
The Old-Timers Are Cashing Out
Can you blame them? If you bought Bitcoin at $5,000 or $10,000 and saw its price reach $126,000, wouldn’t you sell and book some profits? Traders who bought in recently at around $94,000 are now underwater with Bitcoin trading at $82,000, while the long-term holders remain in good shape even after the crash.
There is an expression in trading: “Bulls make money, bears make money, pigs get slaughtered.” The smart money took profits. The late arrivals got caught.
Will Bitcoin Go Back Up?
This is the million-dollar question, right? Actually, it’s more like the $40,000 question at this point.
Look, I’ve been watching crypto since 2013. Bitcoin has “died” more times than I can count. It crashed 83% in 2018. Everyone said it was over. Then it came back and hit new highs. That doesn’t mean it’ll happen this time, but the pattern exists.
Some forecasters still see Bitcoin reaching $112,000 to $116,000 by the end of November 2025, banking on ETF inflows returning and sentiment improving. Others think we’re headed lower if $80,000 breaks.
Technical indicators show the market’s oversold. The RSI (a fancy measurement tool) is sitting at 22.65, which typically means things have gotten too beaten down. But “typically” doesn’t always mean “definitely”.
What Smart Institutions Are Doing
Not everyone’s panicking. Harvard University actually tripled their Bitcoin ETF holdings to $443 million through BlackRock’s IBIT. Harvard’s not exactly known for throwing money around recklessly. They see something here.
That’s the contrarian play — buy when there’s blood in the streets. It works until it doesn’t.
Bitcoin Prediction: Who Knows Anything Anymore?
Every analyst has a Bitcoin prediction. Some say $150,000 by the end of the year. Others say $50,000. At this point, predictions are basically expensive guesses.
What we do know: markets are spooked, the Fed’s not helping, institutional money is leaving, and leverage got flushed out of the system. That’s not a recipe for immediate recovery.
Based on multiple technical indicators, the current forecast for Bitcoin in 2025 is bearish. But longer-term? Who knows? Bitcoin’s survived worse.
The Real Question: Why Is Bitcoin Dropping Right Now?
Strip away all the jargon and here’s what’s happening: Too many people borrowed too much money to bet on Bitcoin going up. The Fed didn’t play ball with rate cuts. Big institutional investors got nervous and pulled $3.79 billion out. That selling pressure pushed prices down, which triggered automatic liquidations, which pushed prices down more.
Add in some concerning comments from major players about Bitcoin’s long-term security, mix in some profit-taking from early investors, and you’ve got a perfect storm.
My electrician asked me about Bitcoin last week. “Should I buy the dip?” he said. I told him what I’ll tell you: only invest money you can afford to lose. This isn’t your retirement fund. It’s not your kid’s college savings. It’s speculative and volatile and can swing 30% in a month.
What November Taught Us
November is historically Bitcoin’s best month, with an average 41.22% rally. This November? Total disaster. That tells you something about how unpredictable this market really is.
The ETFs were supposed to stabilize Bitcoin. Instead, they created a new way for money to leave quickly. The halving was supposed to send prices to the moon. Instead, we’re down 35% from the peak.
Where Do We Go From Here?
Bitcoin’s sitting at a crossroads. Either it holds around $80,000 and starts building back up, or it breaks lower and tests everyone’s nerve.
The bears will tell you we’re headed to $50,000. The bulls will tell you this is a gift. They’re both guessing.
What I know for sure: this Bitcoin crash has shaken out the weak hands. The people who bought on credit, who didn’t understand what they were buying, who thought it was a get-rich-quick scheme — they’re gone. What’s left are the true believers and the opportunists waiting to see what happens next.
If you’re thinking about jumping in, ask yourself: can I handle watching this drop another 30%? Can I sit on this for years if I need to? If the answer’s no, then maybe stick with index funds.
If the answer’s yes, well, Bitcoin’s on sale. Whether it’s a bargain or a trap depends on what happens over the next few months. The Fed’s next move, ETF flows, institutional appetite, regulatory clarity — all of it matters.
For now, the market’s in wait-and-see mode. And so am I.