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The crypto market crash on November 4 sent shockwaves through the digital asset world. In just a few days, over $400 billion was wiped from the total crypto market cap. Traders and investors alike were left wondering what caused the sudden downturn — and if it’s something to worry about.
Just a few days earlier, Bitcoin (BTC) traded around $111,000, Ethereum (ETH) was above $3,900, and XRP sat near $2.60. Everything looked steady. But by Monday, prices plummeted. Bitcoin dropped below $99,000, marking its lowest level in almost five months. Ethereum also fell sharply to $3,200, turning negative for the year.
What made the fall surprising was that the broader economy looked stable. The U.S. Federal Reserve had just cut interest rates, U.S.–China trade talks were improving, and inflation numbers came in lower than expected. So, why did the crypto market crash happen?
Why the Crypto Market Crashed
Analysts from the Kobeissi Letter explained that the crash was more technical than fundamental. They pointed out that adoption levels, technology growth, and deregulation trends remain strong — signs that should support crypto in the long run.
Today is one of those days:
Just about every asset class is trading lower today and all intra-day rally attempts are being sold.
It's simply widespread profit-taking.
In our view, nothing has changed fundamentally speaking.
That said, the most healthy bull markets experience…
— The Kobeissi Letter (@KobeissiLetter) November 4, 2025
The main trigger was excessive leverage in the market. Futures traders have been taking highly leveraged positions, which makes price swings much more violent. When momentum fades or uncertainty hits, those leveraged positions are quickly liquidated — leading to even bigger drops.
In fact, more than 300,000 traders were liquidated in just 24 hours during the crash. The analysts called this “one of the most reactive markets in crypto history.” This high level of leverage is what caused the steep decline, not a breakdown in the fundamentals.
Global Market Reaction
The crypto market crash on November 4 wasn’t an isolated event. Global markets also slipped slightly early in the week. Japan’s stock market lost 4.5%, and U.S. equities pulled back modestly. However, traditional markets didn’t suffer nearly as much — mainly because crypto trading carries far more leverage and volatility.
Despite the chaos, experts believe the long-term outlook for crypto remains strong. Institutional interest, blockchain innovation, and mainstream adoption continue to grow. While short-term swings may stay wild, the long-term story for Bitcoin, Ethereum, and other assets is still bullish.
Bottom Line
The crypto market crash on November 4 was driven mainly by leveraged trading and technical pressure, not by weak fundamentals. Investors who understand crypto’s volatility know that these dips are often temporary. As always, patience and risk management remain key.
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