Bitcoin had a dismal start to November; is it really going to hit 90,000?

The first week of November saw a very poor sentiment in the cryptocurrency market. Bitcoin was close to the low point of the “10.11” crash, and ETH also fell below $3,500. Except for the privacy sector, which is still maintaining a high level, all other sectors in the cryptocurrency market experienced a sharp drop. Liquidations in 24 hours exceeded $1 billion, which seems to have become commonplace.

There must have been some reasons for the decline, but we’ll see in hindsight.

Industry insider

Two projects have run into trouble in the past two days. On November 3rd, Balancer, a well-established and well-known DeFi project, suffered a $116 million theft due to a code error. Balancer is part of DeFi infrastructure and is even older than Uniswap, so this kind of code problem has a significant impact on the industry.

On November 4th, a wealth management platform called Stream Finance collapsed, with the company stating a loss of $93 million. However, the source of the loss remains unclear, and the company has not provided details. Community speculation suggests it occurred on the day of the massive stock market crash, “October 11th.”

There’s only so much money in the crypto world, and another 200 million has disappeared in the last two days.

From a macro perspective

In fact, if you look at the global capital markets, everything was falling on November 4th. Even Japanese and South Korean stocks, which had hit new highs, fell, and US stocks also fell in pre-market trading.

First, there’s the interest rate cut. Last Wednesday, the Federal Reserve’s speech made it seem certain that a rate cut would occur in December, suggesting there was no need to rush into a rate cut.

Then ETFs also saw net outflows. Last week, the US stock ETF for Bitcoin saw a net outflow of $802 million, and on Monday, November 3, it saw another net outflow of $180 million.

Another event on November 5th is the oral arguments of the U.S. Supreme Court’s “tariff trial,” which will examine the legality of Trump’s imposition of global tariffs. The uncertainty lies in the fact that if the final ruling is against Trump, the tariffs may be lifted, leading to further policy adjustments.

The US federal government shutdown has entered its 35th day, tying the record for the longest shutdown in US history. The government shutdown has led institutions to hedge against high-risk assets, triggering a sell-off.

Judging the bottom of the decline

Glassnode commented that the market continues to struggle above the short-term holding cost price (approximately $113,000), a key battleground between bulls and bears. Failure to regain this level could lead to a further decline towards the active investor’s actual price (approximately $88,000).

CryptoQuant CEO Ki Young Ju released a series of on-chain data last night, stating that the average cost of Bitcoin wallets is $55,900, meaning holders have made an average profit of approximately 93%. On-chain fund inflows remain strong. The price is unable to rise due to weak demand.

Markus Thielen, CEO of 10x Research, stated after the market decline that Bitcoin is approaching the support level established since the crash on October 10th. A break below $107,000 could see it fall to $100,000.

Chinese crypto KOL Banmuxia publicly stated today that “the traditional four-year bull market cycle has ended, and Bitcoin will gradually fall to $84,000, then experience several months of complex fluctuations, before surging to $240,000 by the end of next year or the beginning of next year, following the bubble burst in the US stock market.”

The only good news at present is that Bitcoin has historically risen in November on average.

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