Crypto Gloom Could Ignite a Firestorm Rally – Here’s Why

When markets bleed, opportunists feast. A new study reveals crypto's darkest hours often precede explosive rebounds—while Wall Street hedgies scramble to explain why they sold at the bottom (again).

Bear markets breed bull runs

Extreme fear metrics mirror 2018's trough-before-20x surge. Retail capitulation? Check. Institutional FUD? Naturally. All that's missing is the spark—and history says it's coming.

Short sellers walking into a trap

Perpetual funding rates just flipped negative—a classic contrarian signal. When leveraged bears pile in, violent squeezes follow. Just ask 2021's liquidated hedge funds.

The cynical take: Traders will front-run the rally, regulators will panic-ban it, and your broker will mysteriously 'experience outages' on the way up. Place your bets.

Trader Fear Fuels Buy Opportunities

Santiment and other data providers point to extreme pessimism across the market. Based on reports, the crypto Fear & Greed Index returned a score of 15 out of 100 on Thursday, a reading labeled “extreme fear” and the lowest since March.

Joe Consorti, head of bitcoin growth at Horizon, said current sentiment mirrors the mood in 2022 when Bitcoin traded around $18,000. Fear is high. Many investors have pulled back.

Traders’ moods are fading toward crypto, which is welcomed news for the patient.

Bitcoin $BTC: Even bullish/bearish ratio of social media comments (significantly lower than usual)Ethereum $ETH: Just over 50% more bullish vs. bearish comments (less than usual)XRP… pic.twitter.com/ZY9RXUxKDK

— Santiment (@santimentfeed) November 12, 2025

Crypto Capitulation Can Precede A Rally

Some market watchers see the squeeze of weak hands as a buying window. According to Santiment, when retail selling peaks, larger holders often absorb the coins that are liquidated, and prices can be pushed upward afterward.

Samson Mow, founder of Jan3, has argued that the sellers now are mostly newer buyers who entered over the last year and are taking profits, while long-term holders are stacking more Bitcoin.

This view suggests selling pressure could be temporary and that accumulation by committed holders may be setting up a rebound.

Completely wild.

F&G Index at $18,000 → 20 F&G Index at $100k → 20 pic.twitter.com/SNS1bqhx68

— Joe Consorti (@JoeConsorti) November 12, 2025

Public sentiment is just one piece of the picture. Based on reports from Glassnode and others, key on-chain indicators are showing patterns similar to past drawdowns, yet supply held by long-term addresses remains meaningful.

October added to the uneasy backdrop after it ended with the largest market liquidation since the pandemic, wiping out billions within hours.

Markets were also shaken by comments from US President Donald TRUMP about 100% tariffs on Chinese imports, which revived global trade fears and fed volatility.

Technically, Bitcoin recently flashed its fourth “death cross,” a bearish signal that has on past occasions been followed by extended weakness. That is a clear warning. But historical seasonal data still leans positive for year-end.

Data from Coinglass shows Bitcoin finished six of the past eight Decembers higher, with gains ranging from 8% to 45%. So while caution is reasonable given current signals, there is a statistical pattern that traders will watch as the year closes.

Based on the mix of sour sentiment, on-chain buyer behavior, and historical seasonality, the market could experience a swift MOVE if retail capitulation slows and larger players step in. That move may look sudden. It could also unfold gradually, depending on macro headlines and liquidity flows.

For now, the mood is rather gloomy and the numbers are stark for crypto. Yet a shift in who is holding coins might be the trigger that changes price action before the year ends.

Featured image from Meta, chart from TradingView