November Crypto Market Analysis: Flash Crash and Cycle Strength

EXECUTIVE SUMMARY

November 2025 stands out as one of the most intense periods the market has faced in years. Bitcoin reached a record high at $126,210 before tumbling more than 35%, hitting $80,000 during the dramatic November 21 flash crash. Confidence evaporated almost instantly, and weeks of steady gains disappeared in a single wave of forced selling.

A closer look tells a far more interesting story. Liquidity patterns, on-chain behavior, and macro signals reveal a market going through a heavy reset rather than a structural breakdown. The drawdown fits the rhythm of a strong cycle, where rapid expansions often give way to sharp corrections before momentum rebuilds.

System stability remains solid. Major platforms continue operating smoothly, and no chain reaction has formed across the ecosystem. Large capital flows show quiet accumulation around lower ranges, a sign that experienced players view this zone as strategically important. Technical indicators also reflect deep exhaustion on the sell side, suggesting the move came from stress and liquidation pressure rather than a shift in long-term direction.

The shock of November reshaped sentiment, yet the underlying trend still shows strength. Beneath the turbulence, the core of the market continues to hold firm, preparing the ground for the next phase once conditions settle.

PART 1: ANATOMY OF THE NOVEMBER CRASH AND THE NOV 21 “FLASH CRASH”

1.1. Market Developments: When the “Black Swan” Hit

The month opened with growing stress across markets, but the pressure accelerated after a major macro shock. On October 10, 2025, the renewed trade confrontation between the United States and China brought a fresh round of tariffs, including a 10% broad import charge and a 54% rate on Chinese goods. Global liquidity tightened immediately, and $19 billion vanished from market capitalization in a single session. The reaction revealed how quickly capital retreats when policy uncertainty surfaces.

Fear reached its peak at 7:34 UTC on November 21. Liquidity on Hyperliquid, one of the most active derivative venues, thinned within seconds. Bitcoin collapsed from $83,307 to $80,255 in a one-minute plunge as liquidation engines fired across the book. The event fit the classic profile of a flash crash: an aggressive vertical drop triggered by trapped leverage, followed by an equally swift rebound toward $83,000 once bids returned.

1.2. The Numbers: The Weight of Liquidations

The impact on leveraged traders was immense.
Total liquidations in the following 24 hours reached $2 billion, the heaviest wipeout since April 2025. A total of 396,000 accounts were caught in the cascade, showing how crowded long positions had become near the highs.

Five large Hyperliquid accounts, each controlling about $10 million, were cleared entirely. The biggest single hit reached $36.78 million, a reminder that size offers little protection when leverage stacks up in a stressed market.

The move to $80,000 marked a full reset of year-to-date performance. The shift in sentiment was immediate as conditions swung from early-year euphoria to deep fear across the broader market landscape.

PART 2: TECHNICAL ANALYSIS & INTERNAL HEALTH (BTC & ETH)

2.1. Bitcoin (BTC): Momentum Signals a Local Bottom

Bitcoin trades in the $86,000 to $88,500 band after lifting sharply from $80,000. Market structure shows absorption at lower levels and early signs of strength returning.

Key technical signals highlight exhaustion on the sell side:

• RSI: The daily RSI sits at 28.04, a zone that historically captures stress points near mid-cycle lows. Previous cycles often turned upward shortly after RSI slipped under 30, especially during strong market phases. The pattern aligns with readings seen during the late stage of the 2023 correction, where buyers stepped back in after similar pressure.
• MACD: Momentum on MACD stabilizes as the histogram cools and selling energy fades. The slope flattens, which often appears when liquidation-driven moves reach their final stage.
• Price Behavior: The fast rebound from $80,000 reflects aggressive liquidity absorption. Order flow reveals a dense cluster of bids positioned from $80,000 to $84,000, creating a zone where buyers consistently respond. This range forms a strong foundation for near-term structure and anchors sentiment after the flash crash.

2.2. Ethereum (ETH): Underdog or “Golden Opportunity”?

Ethereum experiences one of its toughest stretches in recent years. Price slipped nearly 40% from the $4,953 high and trades between $2,800 and $2,957. The month’s performance shows a drawdown near 30%, heavier than the market’s average near 21.5%. Market share sits around 11.4%, reflecting rotation toward larger assets.

Despite this pressure, the underlying supply dynamics create a compelling setup.

Smart Money positioning reveals three strong signals:

• Large Wallet Activity: High-value wallets added roughly $241 million in ETH around $2,630, an area that repeatedly attracts accumulation during stressed conditions. This shows clear interest in building exposure at current ranges.
• Exchange Balances: Reserve balances fall to a 55-month low with just 15.6 million ETH held on centralized platforms. Available supply tightens considerably when reserves reach multi-year lows. Historically, compressed exchange balances create conditions for faster upside movement once demand increases.
• Market Structure: Price holds above multiple liquidity bands on the higher timeframes. Selling pressure eases as each dip invites deeper spot accumulation, a behavior consistent with the early phase of a rotation cycle.

The combination of declining liquid supply, concentrated accumulation and multi-month structural support gives ETH a setup that often recovers more quickly once volatility cools.

PART 3: THE CASH FLOW WAR – RETAIL PANIC VS. INSTITUTIONAL GREED

The divide between retail flows and institutional behavior reaches a clear extreme this cycle. Capital rotates in opposite directions as short-term sentiment clashes with long-term strategy.

3.1. ETF Outflows and Retail Retreat

Spot ETF products witness one of the heaviest withdrawal waves in 2025. Net redemptions reach $3.55 to $3.79 billion through November. The most striking moment arrived on November 18, when BlackRock’s IBIT recorded $523.15 million in a single-day exit, the largest since inception.

These movements often mirror traditional investors who respond quickly to macro stress. Economic uncertainty and tightening financial conditions drive money toward safer positions, and ETF outflows capture that shift with precision.

3.2. Institutional Accumulation Led by Whales and MicroStrategy

While retail capital leaves, long-term entities build exposure at an accelerated pace. On-chain activity from November 18 to November 22 forms the most active whale accumulation period of the year. Network data shows:

• 102,000 transactions above $100,000
• 29,000 transactions above $1 million

Large wallets holding more than 10,000 BTC expanded reserves by 36,000 BTC from late October onward. Funds move steadily toward stronger hands as volatility rises.

MicroStrategy adds 8,178 BTC at an average of $102,171, reinforcing a strategy focused on long-horizon positioning. Total holdings climbed to 649,870 BTC, equal to more than 3% of circulating supply. Unrealized gains stand near $12.88 billion, creating a substantial cushion and a strong signal of confidence.

3.3. On-chain Signals Point Toward Stabilization

Key indicators highlight a tightening supply environment.

Exchange Reserves
Reserves on major platforms drop to 2.5 to 2.6 million BTC, the lowest level in seven years. Thinner supply often accelerates recovery once demand increases.

MVRV Ratio
Readings stay within the 1.0 to 1.8 band, an area frequently associated with mid-cycle accumulation phases.
• Levels near 3.0 mark overheated conditions
• Levels below 1.0 align with deep cycle lows
• Current readings signal reset conditions and renewed accumulation potential

The combination of shrinking liquid supply, strong institutional inflows, and easing sell pressure forms a setup that frequently appears before recovery phases.

PART 4: WHY THIS IS NOT A “CRYPTO WINTER” (HISTORICAL COMPARISON)

Concerns about a repeat of 2018 or 2022 surface whenever volatility spikes, yet the current structure shows a very different landscape. Market depth, liquidity stability and policy posture create a cycle far stronger than past downturns.

4.1. Drawdown Size and Market Behavior

Previous winter phases carved deep declines through the entire ecosystem.
• 2018 saw an 83% slide from $20,000 to $3,000
• 2022 delivered a 77% contraction from $69,000 to $15,000

The current cycle sits near a 30–35% retracement from the $126,000 peak to $80,000, aligned with the usual mid-cycle resets seen in 2017 and 2021. These pullbacks often mark consolidation phases within broader expansions rather than structural downturns.

4.2. System Stability and Contagion Risk

Past collapses originated from internal failures. 2022 unfolded through a chain of breakdowns: the Terra de-peg, the 3AC collapse, the Celsius freeze and the FTX scandal. Each failure amplified stress until the entire market unraveled.

The 2025 environment follows a different pattern. The November shock came from leverage unwinds and macro pressure. Liquidity thinned during the flash crash, yet core infrastructure remained intact.
A security incident involving Balancer removed $116–128 million, though the impact stayed contained and markets absorbed the loss quickly.

Major venues such as Binance and Coinbase operate with high liquidity buffers and strong credit assessments. Overall network resilience stands at one of its strongest points, supported by deeper derivatives markets, robust custody standards and cleaner balance sheets across major players.

4.3. Policy Environment and Global Momentum

Regulatory posture across leading economies has shifted toward clearer frameworks and more predictable oversight.

The GENIUS Act issued on July 18, 2025 provides a structured path for transparent stablecoin issuers, lifting long-standing compliance concerns. This legislative clarity encourages institutional participation and strengthens payment-focused infrastructure.

The United States maintains a sizable digital asset reserve through prior law-enforcement seizures, a position that signals long-term strategic interest. Leadership changes at the SEC, including the appointment of Paul Atkins, open the door for expanded ETF products such as XRP-focused vehicles and potential approvals for additional large-cap assets.

Globally, momentum continues to build. The European Union advances MiCA implementation, creating unified standards for service providers. Hong Kong supports licensed stablecoin operations, attracting capital from regional players. Mainland flows through Hong Kong increase steadily as more firms explore compliant channels for exposure.

PART 5: STRATEGIC FORECAST AND SCENARIOS FOR Q1-Q2/2026

Market structure, positioning patterns and liquidity behavior outline several clear paths for the next stage of the cycle. Each scenario reflects how capital reacts once volatility cools and macro conditions stabilize.

5.1. Expert Perspectives

Several influential figures outline long-term expectations for Bitcoin based on structural growth and institutional participation.

Cathie Wood and Michael Saylor

Both highlight a multi-year expansion driven by allocations from pension funds, insurers and large investment pools. Their long-range projections extend toward the $500,000 to $1,000,000 band as digital assets integrate with a global financial base measured in the hundreds of trillions.

JPMorgan
Analysts estimate Bitcoin’s fair value relative to gold near $165,000 to $170,000, positioning the current $86,000 range well below their equilibrium model.

Samson Mow
He frames the recent surge to $126,000 as an early advance rather than a late-cycle climactic move, suggesting substantial room for further expansion once liquidity strengthens.

5.2. Primary Scenario, 60% Probability: The Coiled Spring

Market structure favors a prolonged consolidation phase before the next expansion leg.

Accumulation Phase, Dec 2025 to Jan 2026
Trading activity concentrates between $84,000 and $100,000. This zone encourages accumulation, resets leverage and draws focus away from short-term noise.

Base Formation
Repeated tests around $80,000 strengthen the foundation. Persistent demand from large entities and ETF programs creates steady absorption throughout this band.

Breakout in Q1–Q2 2026
A shift toward positive ETF flows, combined with easing macro pressure, opens a path toward a move above $100,000. Momentum from renewed liquidity could carry the market toward the $150,000 region.

5.3. Secondary Scenario, 30% Probability: Double Bottom

Price action revisits the $78,000 to $80,000 area once more if macro stress intensifies. This structure typically marks the final stage of a reset before a sustained advance. Market depth and spot demand at this level create conditions for a durable reversal.

5.4. Adverse Scenario, 10% Probability: Deep Cycle Stress

A major shock, such as a high-impact exchange failure or a disruptive policy event, may push price toward $60,000. This path requires a severe external catalyst strong enough to absorb the liquidity currently anchored near $80,000.

CONCLUSION: DAWN AFTER THE STORM

November 2025 delivers a rare market moment where fear dominates the surface while structural strength grows underneath. Sharp swings and a 35% reset capture headlines, yet the foundation of the cycle gains resilience through deeper liquidity, disciplined accumulation and policy clarity.

Large entities continue expanding exposure, exchange balances shrink to multi-year lows and regulatory frameworks move toward greater transparency. These elements create the conditions for the next expansion phase as volatility cools and capital rotates back into the market.

The current environment signals the early stage of a renewed advance. Price discovers its floor, long-term positioning strengthens and the broader trend prepares for a new leg of growth once demand returns with full force.

Key Focus Points

Short-term
• Track the $80,000 to $85,000 band
• Follow ETF activity and shifts in net flows
• Monitor liquidity pockets that form after each retracement

Long-term
• Favor steady accumulation during this range
• Maintain exposure to leading assets such as Bitcoin and Ethereum
• Align positioning with the structural trend heading into 2026

The storm has passed. What remains is a market building strength for the next decisive move.