Prominent market analyst Tom Lee, who currently serves as the chairman of BitMine Immersion Technologies, has identified several possible drivers behind the recent sharp decline in the cryptocurrency market. The downturn has wiped billions from the overall market capitalization in just a few days and caused significant volatility in leading digital assets.
Multiple factors weigh on the crypto market
Lee suggests that the recent sell-off in AI and semiconductor stocks, most notably Nvidia, played a major role. The sharp drop in these technology equities reportedly led to margin calls among retail investors, particularly in Asian markets. This, in turn, forced some investors to liquidate other assets such as cryptocurrencies to cover their leveraged positions.
He adds that another contributing factor may be investors freeing up capital for Anthropic’s impending initial public offering. Anthropic, an AI research company founded by former OpenAI researchers, is preparing one of the industry’s most anticipated IPOs.
Lee further points to the continued effects of the $6.3 billion Binance hack in late October. Some account holders who have recovered a portion of their funds may be exiting the market or converting assets into stablecoins, prompting additional selling pressure.
Beyond these market events, Lee also notes heightened U.S. regulatory scrutiny over semiconductor exports to Asian markets, including China, as well as growing concerns regarding AI’s potential risks to cybersecurity infrastructure.
He emphasizes, however, that these reasons remain possible insights rather than definitive explanations for the timing and magnitude of the downturn.
Mini dictionary: Anthropic is an artificial intelligence research organization founded in 2021 by former OpenAI employees. The company is focused on building trustworthy AI models and has attracted significant venture capital and market attention ahead of its IPO.
Sharp declines in major cryptocurrencies
Throughout the recent sell-off, Bitcoin, the world’s largest cryptocurrency, dropped below the psychological $70,000 mark on Friday, November 13. Pressure continued over the weekend as Bitcoin slipped under $66,000 and reached as low as $62,112 on Sunday, marking its weakest level since July.
Ethereum, the second-largest crypto asset by market capitalization, experienced an even steeper loss, falling to roughly $1,711—its lowest level since early July.
Other prominent altcoins, including XRP and Solana (SOL), also registered substantial losses over the same period.
| Asset | Recent Low | Previous Low (July) |
|---|---|---|
| Bitcoin (BTC) | $62,112 | Above $62,112 |
| Ethereum (ETH) | $1,711 | Above $1,711 |
| XRP | Significant drop (exact figure not stated) | Not specified |
| Solana (SOL) | Significant drop (exact figure not stated) | Not specified |
The sell-off accelerated as Bitcoin dipped below $70,000, followed by Ethereum’s drop to $1,711 and major altcoins like XRP and Solana recording steep declines as well.
Market liquidations and ETF outflows escalate
The volatile price action triggered a major round of liquidations in the cryptocurrency derivatives market. According to data from CoinGlass, about $2 billion in leveraged crypto positions were liquidated over the past 24 hours, with a majority involving investors who held bullish positions.
At the same time, the correction in digital asset prices coincided with large outflows from U.S.-listed spot Bitcoin exchange-traded funds. From October 30 to November 13, these ETFs experienced nearly $3 billion in net withdrawals, signaling that institutional investors were also reducing exposure to the sector.
CoinGlass data shows roughly $2 billion in leveraged crypto positions have been liquidated in just one day, while nearly $3 billion has been pulled from U.S. spot Bitcoin ETFs over a two-week period.
