Bitcoin's current weakness tells an interesting story—it's not about the long-term thesis breaking down, but rather a short-term funding squeeze that's flipping the script on what used to support prices.

Here's what's happening:

**Capital is quietly exiting.** BlackRock's IBIT ETF pulled $520M in November alone (largest monthly redemption since launch), while stablecoin supply contracted for the first time in months. USDE got cut roughly in half after the October liquidation hit. Meanwhile, corporate treasuries that were busy buying BTC are now selling or buying back shares to reduce debt—Sequans is doing exactly this.

**The feedback loop is real.** That $19B liquidation on Oct 10 didn't just shake weak hands. It triggered a reversal: former growth drivers (ETF inflows, stablecoin expansion, treasury accumulation) are now accelerators of the downside. ETFs that once cushioned dumps are now letting them rip.

**Technical damage is visible.** IBIT broke below key trendlines, BTC dropped under major moving averages, and Bitcoin dominance slipped to 58.8% (lowest since Dec 2024). Over $914M got liquidated when BTC dipped below $87K, with 78% of that coming from long positions.

**But here's the catch:** Retail sentiment shows extreme pessimism ($70K expectations), and historically, markets don't oblige when everyone agrees on the downside. Reclaiming $100K weekly close flips the narrative; dropping into $72-78K territory could trigger institutional accumulation again.

TL;DR: Near-term mechanics are ugly, but the long-term demand story isn't broken—just temporarily buried under liquidation rubble and institutional repositioning.