Bitcoin Updates: Concerns Over Tether and Company Bitcoin Offloads Trigger $638 Million in Crypto Sell-Offs
- Crypto markets crashed on Dec 1, 2025, with $638M in 24-hour liquidations driven by Tether fears, corporate Bitcoin sales, and regulatory pressures. - Bitcoin dropped 5% to $86,800, erasing $144B in market cap, while leveraged long positions accounted for $568M of total liquidations. - MicroStrategy's $56.26B Bitcoin holdings and Tether's solvency risks triggered panic, despite low probability of pre-year-end sales per prediction markets. - Regulatory warnings from China and liquidity concerns worsened c
Crypto Market Faces Major Downturn Amid Liquidation Surge
On December 1, 2025, the cryptocurrency sector was hit by a significant sell-off, with global liquidations reaching $638 million in just 24 hours. This sharp decline was fueled by mounting concerns over Tether’s stability, the possibility of large Bitcoin sales by major holders, and increasing regulatory scrutiny.
Bitcoin (BTC) dropped 5% to $86,800, wiping out $144 billion from the overall crypto market value. Leading altcoins such as Ethereum (ETH) and XRP also suffered, falling 5.6% and 6.5% respectively, as reported by CoinGlass. The majority of these losses stemmed from leveraged long positions, which made up $568 million of the total liquidations.
MicroStrategy Comments Intensify Market Fears
Market anxiety escalated after MicroStrategy CEO Phong Le suggested the company might sell some of its Bitcoin holdings, valued at $56.26 billion, to finance dividend payouts. Although prediction markets like Myriad estimated only a 5% chance of such sales before year-end, the remarks unsettled investors. Wenny Cai, COO of SynFutures, explained that these statements altered perceptions about Bitcoin’s supply, triggering a wave of liquidations and heightened volatility across both spot and derivatives markets.
Tether and Regulatory Concerns Add to Pressure
Tether, the issuer behind the USDT stablecoin, also faced increased scrutiny. Arthur Hayes, co-founder of BitMEX, cautioned that a 30% drop in Bitcoin and gold prices could jeopardize Tether’s solvency due to its asset exposure. This warning raised fresh doubts about liquidity and margin requirements, tightening market conditions further. Meanwhile, regulatory headwinds intensified as China’s central bank reaffirmed its opposition to cryptocurrency activities and highlighted the risks associated with stablecoins.
Altcoins and Market Capitalization Take a Hit
The broader impact was pronounced across the market. According to GeekStake, total crypto capitalization fell 4.82% to $2.94 trillion. Altcoins such as Cardano (ADA) and Solana (SOL) experienced losses exceeding 10% as leveraged trades were unwound. CoinGlass data revealed $153 million in liquidations within a single hour, with long positions bearing the brunt. XRP, for example, saw trading volume soar by 92% even as its price dropped 6.74%, underscoring the market’s thin liquidity and ongoing macroeconomic uncertainty.
Outlook Remains Uncertain
Analysts remain wary about a swift recovery. Wenny Cai noted that trading in December is expected to remain volatile, though long-term investors may re-enter after the current shakeout. Prediction markets currently assign a 12% chance to an extended crypto downturn, but immediate risks from corporate selling and stablecoin instability continue to weigh on sentiment. The path to recovery will likely depend on clearer regulations and improved macroeconomic conditions.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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