Moments when everything in the markets turns red simultaneously are the times when investors are most prone to error. This is because what is actually falling at such moments is not the value of the assets themselves, but the flow of liquidity in the market.

On Friday, November 13, 2026, we experienced exactly this. Bitcoin dipped below $68,000—its lowest level since August—marking a 9% decline over the past week. But what is truly notable is that Bitcoin was not alone: gold also fell to a one-year low, the U.S. Dollar Index climbed to a 19-month peak, and the 10-year Treasury yield rose above 5.1%. This scenario should remind you of one thing: this is not a "crypto crash," but a liquidity test.

🩸 When Everything Falls at Once: The Moment Correlation Approaches 1

The principle of "diversification" works well in the markets during normal times. However, in moments of panic, this rule is effectively suspended. When investors are forced to raise cash, they sell everything they hold—whether it is currently in profit or at a loss. This is why gold, Bitcoin, and stocks all move in the same direction.

That is precisely what happened this week. Bitcoin’s 30-day correlation with the Nasdaq currently stands at 0.69, while its correlation with gold sits at 0.38. In other words, Bitcoin is being traded not as "digital gold," but as a "high-beta technology asset." Further evidence supporting this: In the last 24 hours, the positions of 185,595 traders were liquidated, with total liquidations reaching $1.64 billion. Of this, 89%—amounting to $1.46 billion—consisted of "long" positions (bets on a price increase).

📉 The Core Issue: Market "Fuel" Is Dwindling

It is easy to talk about a price drop, but what lies beneath the price? According to Glassnode data cited by Gate, the stablecoin supply has shrunk by $14.2 billion over the last 30 days, falling below $280 billion. This marks the fastest contraction since the collapse of Terra in June 2022. During the same period, $1.64 billion flowed out of U.S. spot Bitcoin ETFs. In short, the influx of new dollars into the market is slowing, while existing capital is exiting. This indicates that "dry powder"—available purchasing power—is evaporating.

Add the commodities sector to the mix: Gold futures closed at a one-year low of $3,885 on Thursday. Silver is down 2.59%, and Brent crude is hovering around the $95 mark. In other words, no asset—not even those considered "safe havens"—is immune to this withdrawal of liquidity.

🕰️ Is History Repeating Itself? Lessons from 2020 and 2008

This scenario is, in fact, familiar. When the COVID-19 panic set in during March 2020, stocks plummeted by 34%, Bitcoin lost as much as 50% of its value in a single day, and even gold retreated by 12% within a few days. A similar phase occurred during the 2008 global financial crisis: first, everything was sold off, and then, as central banks injected liquidity, assets staged a rapid recovery.

However, a caveat is in order: past recoveries were driven by swift and aggressive interventions from central banks. In 2020, the Fed initiated unlimited bond purchases, and similar liquidity support was provided in 2008. Today, however, the Fed’s hands are not as free as they were in 2020, due to the ongoing battle against inflation. Consequently, the expectation that "liquidity will return and everything will bounce back" may be more precarious this time around, particularly regarding timing.

💎 So, What Should an Investor Do?

Let’s be clear: this is not a call to "buy the dip." Nevertheless, the following three observations may assist in your decision-making process:

1. Panic selling is a symptom of a liquidity crisis, not its final stage. Once forced liquidations cease and the supply of sellers is exhausted, prices often recover faster than anticipated—though no one can predict exactly when this will happen.
2. True value emerges once correlations return to normal. A shift—such as gold reclaiming its role as a "safe haven" or Bitcoin realigning with its "digital gold" narrative—could serve as a key signal. Currently, both are being swept in the same direction.
3. In this environment, holding cash is, in itself, a position. If you are scouting for opportunities, exercise patience and wait for liquidity to stabilize. After all, one should look to buy into "post-bottom stability" rather than the "bottom" itself.

👉Do you believe this liquidity crunch is merely a transient panic, or is it the onset of a more prolonged contraction?
👉How do you interpret the simultaneous decline in gold and Bitcoin?

Share your thoughts in the comments. ✍️

This content is for informational purposes only and does not constitute investment advice.

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