Bitcoin and the wider crypto market have kicked off December with a fresh wave of losses, dashing hopes that November’s pain was behind investors.
On December 1, 2025, Bitcoin fell roughly 5–6% intraday, trading around the mid‑$86,000s after briefly slipping below $86,000 in early Asian hours. Ethereum dropped more than 6% toward the $2,800–2,850 range, while major altcoins like Solana, Dogecoin and XRP also slumped in tandem. [1]
Multiple factors are hitting the market at once:
- A global “risk‑off” shift tied to rising Japanese bond yields and renewed bets on a Bank of Japan rate hike. [2]
- A DeFi security shock after an “incident” at Yearn Finance’s yETH pool. [3]
- A cascade of forced liquidations wiping out more than half a billion dollars in leveraged crypto bets. [4]
- Mounting structural pressures, including record outflows from U.S. spot Bitcoin ETFs and a credit downgrade for stablecoin giant Tether. [5]
Below is a deep dive into what’s happening across Bitcoin, Ethereum, DeFi and the wider digital‑asset market today.
Bitcoin price today: fresh 5–6% slide as December opens
Across major outlets including Bloomberg, CNBC, Reuters and regional Asian and European media, the story is broadly consistent: the crypto sell‑off that dominated November has not only continued—it has accelerated on the first trading day of December. [6]
Key price action as of December 1, 2025:
- Bitcoin (BTC)
- Dropped as much as around 6% in early Asia, falling below the $86,000 mark before recovering slightly. [7]
- Around late morning in London, BTC was hovering in the mid‑$86,000s, having shed about 5% on the day and trading not far above November’s eight‑month low near $80,500. [8]
- November alone saw more than $18,000 wiped off Bitcoin’s price, the largest dollar loss for a single month since May 2021. [9]
- Ethereum (ETH)
- Other major tokens
According to one London‑based research director cited today, Bitcoin is again acting like a barometer for global risk appetite, and the latest slide “does not bode well for stocks at the start of this month” as correlations between crypto and equities remain tight. [15]
Why is crypto crashing again? The four big pressures behind today’s move
1. Asia leads the selling as Japan bond yields spike
The first leg of today’s sell‑off came from Asia. In its Asia Morning Briefing, CoinDesk flagged a sharp move higher in Japanese government bond yields: Japan’s 2‑year yield briefly touched about 1.01%—its highest level since 2008, as traders increasingly bet that the Bank of Japan is getting closer to raising rates. [16]
That move had ripple effects:
- The yen strengthened, making yen‑funded “carry trades” less attractive.
- Investors started unwinding risk positions that had been financed cheaply in yen—including leveraged crypto bets.
- As liquidity tightened in early Asian hours, Bitcoin dropped below roughly $87,500 and Ethereum followed lower, triggering margin calls and forced selling. [17]
Prediction markets tracked by CoinDesk now see roughly even odds of a BOJ rate hike at the upcoming meeting, underscoring how central‑bank expectations in Japan—a market often seen as yield‑sensitive and risk‑hungry—are feeding straight into crypto volatility. [18]
2. A wave of forced liquidations: over $600 million wiped out
Once prices started to slip, derivatives markets did the rest.
Coinglass data cited by CoinDesk shows that around $646 million in leveraged crypto positions were liquidated in early Monday trading, the vast majority of them bullish long bets. [19]
- Nearly 90% of the liquidations were longs, indicating that traders who had been betting on a rebound were forced out.
- Bitcoin alone fell more than 5% to around $86,000, while Ethereum slid over 6% to near $2,815 during the flush. [20]
- Major exchanges such as Binance, Hyperliquid and Bybit each recorded more than $160 million in liquidations, highlighting how crowded the long side of the trade had become. [21]
Analysts note that this kind of liquidation cascade often appears at local extremes, when crowded positioning collides with thin liquidity. However, it also deepens intraday losses, making the sell‑off feel more like a crash than a slow grind.
3. DeFi shock: the Yearn Finance “Yearn Incident”
At almost the same time as the macro shock from Japan, markets were rattled by a DeFi security scare.
According to multiple outlets republishing CoinDesk’s reporting, Yearn Finance disclosed an “incident” affecting its yETH pool, a product composed of Ethereum liquid‑staking derivatives. [22]
- Social‑media analysis suggests attackers exploited a vulnerability to mint a large amount of yETH in a single transaction, draining the pool.
- Around 1,000 ETH—roughly $3 million at current prices—was reportedly siphoned off and routed through privacy tools such as Tornado Cash, according to follow‑up coverage tracking the stolen funds. [23]
While the amounts involved are small relative to the overall market, the psychological impact was large:
- Investors are already on edge after a month of drawdowns and ETF outflows.
- A fresh exploit in a high‑profile DeFi protocol revives memories of past hacks, leading some traders to de‑risk aggressively, especially across DeFi‑linked tokens.
CoinDesk summarized the mood bluntly: major cryptocurrencies began December “on a negative note” amid the Yearn incident, with Bitcoin, Ether, SOL, DOGE and XRP all extending November’s downtrend. [24]
4. Structural headwinds: ETF outflows, Tether downgrade and risk appetite
Beyond today’s headlines, several slow‑burn stories from November are now converging on prices.
Record outflows from U.S. Bitcoin ETFs
Reuters reports that U.S. spot Bitcoin ETFs saw record net outflows of around $3.4 billion in November, even as volumes stayed high. [25]
- That level of selling pressure from regulated products has added to the market’s downside momentum.
- It also suggests that a part of the institutional buyer base is locking in profits or de‑risking after the strong rally earlier in 2025.
Tether’s credit rating downgrade
Adding to the gloom, S&P Global cut its rating on Tether, the largest dollar‑pegged stablecoin, citing a rising share of higher‑risk assets in its reserves and ongoing disclosure concerns. Tether has publicly disputed the assessment, but the downgrade still reinforced worries about systemic risk in stablecoins. [26]
Stablecoins sit at the center of crypto liquidity. Any sign of trouble—even at the rating‑agency level—tends to make traders more cautious and less willing to hold riskier tokens.
Bitcoin treasuries and index risk
The Reuters piece also flags comments from Phong Le, CEO of “Strategy,” the world’s largest corporate Bitcoin holder, who said the firm would consider selling some holdings if a proprietary metric measuring the ratio of its enterprise value to its BTC stash fell below 1. [27]
- That metric is currently above that threshold, but the fact that such a line in the sand exists has drawn attention.
- Index provider MSCI is simultaneously consulting on whether to remove companies whose digital‑asset holdings exceed 50% of their assets from some benchmarks, which could add pressure to Bitcoin‑heavy corporate treasuries if implemented. [28]
Together, these stories chip away at the “institutional adoption” narrative that supported Bitcoin’s run‑up earlier in the year.
Altcoins join the rout: ETH, SOL, DOGE, XRP and more
It’s not just Bitcoin that’s bleeding.
- Ethereum (ETH)
ETH is underperforming BTC on the day, down around 6–7%, trading in the $2,800–2,850 area and extending a roughly 22% drop for November. [29] - Solana (SOL)
SOL is among the hardest‑hit large caps, with declines of 7–8% reported across multiple data providers. [30] - Dogecoin (DOGE)
DOGE fell about 8–9% in early trade, according to figures shared alongside CNBC’s coverage of the sell‑off. [31] - XRP and other majors
XRP has slid roughly 7% to near $2.05, with chart‑based analysis warning that a sustained break below that level could open the way to the $1.80–1.87 support zone. [32]
Business Standard notes that total crypto market capitalization has dropped about 4–5% over the last 24 hours to just under $3 trillion, with trading volumes surging more than a third as forced liquidations and panic‑selling accelerate. [33]
Sentiment: from “buy the dip” to “risk‑off”
The mood among traders and analysts has shifted markedly over the past few weeks.
- Reuters points out that Bitcoin historically tends to rise about 9–10% on average in December, making it one of its stronger months. But that seasonality has so far clashed with a high correlation between BTC and stock indices and a renewed wave of risk aversion. [34]
- Volatility gauges such as the VIX recently dropped back below their 12‑month average, which some strategists say left markets vulnerable to a sharp swing as complacency gave way to fear. [35]
- Business Standard quotes derivatives analysts who view today’s move as more of a “leverage flush‑out” than a fundamental breakdown, arguing that once over‑extended longs are cleared, Bitcoin could stabilize and attempt to retest the $90,000–92,000 zone. [36]
At the same time, Coindesk’s liquidation report stresses that open interest in Bitcoin and Ether perpetual futures is now falling, confirming that leverage built up during the October rally continues to wash out of the system. [37]
In other words, this is a classic risk‑off reset: macro headwinds, over‑crowded positioning and a DeFi scare have combined to force speculative money to the sidelines.
What markets are watching next
While this article is for information and not investment advice, several themes are likely to shape how the Bitcoin and broader crypto market trade in the coming days and weeks:
- Bank of Japan decision & global yields
- Any further signs that the BOJ is willing to tighten policy could keep pressure on yen‑funded carry trades and, by extension, on crypto risk‑taking. [38]
- Follow‑through from the Yearn Finance exploit
- If the Yearn incident remains contained—and affected users are compensated—DeFi confidence could heal relatively quickly. Escalating exploit news, by contrast, would be a fresh drag on sentiment. [39]
- ETF flows and institutional positioning
- Traders will be watching whether U.S. spot BTC ETFs continue to see outflows or stabilize after November’s record withdrawals. Sustained outflows would reinforce the idea that larger investors are de‑risking into year‑end. [40]
- Stablecoin and regulatory headlines
- The Tether downgrade and ongoing stablecoin scrutiny in several jurisdictions mean that any new regulatory announcements could quickly affect liquidity and risk appetite. [41]
- Key technical levels
- Analysts are eyeing zones around $89,500 (resistance), $87,000 (recent break), and $85,500–$82,000 (potential downside targets) as near‑term inflection points for Bitcoin. [42]
For now, the message from December 1 is clear: crypto’s winter isn’t over yet. After a brutal November, Bitcoin and its peers are still searching for a stable floor in an environment where macro shifts, leverage and DeFi risk can turn sentiment on a dime.
References
1. www.bloomberg.com, 2. www.coindesk.com, 3. www.coindesk.com, 4. www.coindesk.com, 5. www.reuters.com, 6. www.bloomberg.com, 7. www.bloomberg.com, 8. www.reuters.com, 9. www.reuters.com, 10. www.bloomberg.com, 11. www.reuters.com, 12. www.bloomberg.com, 13. www.linkedin.com, 14. www.coindesk.com, 15. www.reuters.com, 16. www.coindesk.com, 17. www.coindesk.com, 18. www.coindesk.com, 19. www.coindesk.com, 20. www.coindesk.com, 21. www.coindesk.com, 22. www.coindesk.com, 23. www.mexc.co, 24. www.coindesk.com, 25. www.reuters.com, 26. www.reuters.com, 27. www.reuters.com, 28. www.reuters.com, 29. www.reuters.com, 30. www.bloomberg.com, 31. www.linkedin.com, 32. www.coindesk.com, 33. www.business-standard.com, 34. www.reuters.com, 35. www.reuters.com, 36. www.business-standard.com, 37. www.coindesk.com, 38. www.coindesk.com, 39. www.coindesk.com, 40. www.reuters.com, 41. www.reuters.com, 42. www.business-standard.com
