Bitcoin loses its last line of defense: $98k breakdown sparks cascade not seen since May

Bitcoin (BTC) dropped 3% to $98,550.33 as of press time, falling below the psychological $100,000 threshold for the third time this month amid cascading leverage liquidations, persistent ETF outflows, and a broader risk-off posture across digital assets.

The slide accelerated after Bitcoin broke support at $100,000 on Binance, triggering over $190 million in long liquidations in the past hour, per Coinglass data.

Total liquidations across the past 24 hours reached $655 million, amplifying downward momentum as over-leveraged positions unwound.

Ethereum declined 5.75% to $3,218.37, Solana dropped 5.2% to $145.55, and BNB fell 3.2% to $922.90, reflecting synchronized selling pressure across major tokens.

ETF flows turn negative as institutional demand softens

US spot Bitcoin ETFs recorded net outflows of $278 million on Nov. 12, contributing to roughly $961 million in cumulative redemptions this month, according to Farside Investors.

The shift from net inflows to modest withdrawals removes a key stabilizing force that supported prices through mid-2025, leaving spot markets more vulnerable to derivatives-driven volatility.

Historical patterns suggest that ETF flow reversals often coincide with consolidation phases rather than periods of directional conviction.

Glassnode’s Nov. 12 analysis confirms that Bitcoin has traded below the short-term holder cost basis of $111,900 since early October, establishing a bearish regime characterized by low liquidity and weak conviction.

The network’s short-term holder realized profit-loss ratio fell below 0.21 near $98,000, indicating that over 80% of the realized value came from coins sold at a loss, representing a capitulation intensity exceeding that of the last three major washouts of the current cycle.

Glassnode identifies the sub-$100,000 zone as a critical battleground where seller exhaustion is beginning to take shape. However, a sustained recovery requires Bitcoin to reclaim the $111,900 cost basis as a level of support.

Sentiment deteriorates as leverage dries up

Bitcoin perpetual futures funding rates remain subdued across major exchanges, with both funding rates and open interest drifting lower since October’s leverage flush.

The absence of aggressive positioning reflects market hesitation, with traders avoiding directional bets as volatility expectations remain elevated.

Options market data reinforces this defensive stance. Put protection trades are priced at an 11% implied volatility premium over calls for short-term expiries, indicating that traders continue to pay for downside insurance.

Open interest concentrates heavily around the $100,000 strike for end-of-November expiries, making this level a critical threshold where dealer hedging flows could amplify volatility if breached.

Recent option flows have focused on puts between the $108,000 and $95,000 strikes, structured as outright protection or calendar spreads that capture near-term turbulence expectations.

Glassnode’s cost basis distribution heatmap reveals a dense supply cluster between $106,000 and $118,000, representing investors positioned to exit near breakeven.

This supply overhang creates natural resistance where rallies may stall unless renewed inflows absorb distribution pressure.

The firm notes demand from short-term holders, a proxy for new investor momentum, has remained notably weak since June 2025, reflecting an absence of fresh capital entering the market.

Broader risk sentiment deteriorated alongside crypto declines, with higher real yields and persistent funding stress pressuring speculative assets despite the recent resolution of the US government shutdown.

Morgan Stanley’s recent “fall season” note advised clients to harvest gains rather than chase upside during this phase of the four-year cycle, contributing to reduced risk appetite among institutional allocators.

The combination of heavy leverage positioning, soft ETF demand, and structural resistance above current prices transformed each breach below $100,000 into a self-reinforcing cascade.

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