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Ethereum News Update: Overleveraging and Retail Hype May Lead to a 50% Cryptocurrency Plunge

Ethereum News Update: Overleveraging and Retail Hype May Lead to a 50% Cryptocurrency Plunge

Bitget-RWA2025/11/21 09:30
By:Bitget-RWA

- Alliance DAO co-founder QwQiao warns next crypto bear market could see 50% drawdown due to excessive leverage and inexperienced investors flooding spot assets and ETFs. - DATs (decentralized autonomous tokens) face sharp reversal risks as inflows plummet 82% to $1.93B in October, while BlackRock's IBIT ETF sheds $2.47B amid record outflows. - Market fractures as critics argue "dumb money" rhetoric oversimplifies maturing crypto adoption, while Ethereum's price struggles and Japan's $135B stimulus fail to

Alliance DAO co-founder QwQiao has delivered a strong caution that the upcoming crypto bear market could be much harsher than many expect, fueled by rampant leverage and a surge of novice participants. In a post dated November 21,

and ETFs without a clear grasp of the risks might trigger a 50% market drop before conditions are set for another bull run. His remarks echo wider industry worries about underlying vulnerabilities, such as .

This warning gained momentum as Placeholder partner Chris Burniske supported QwQiao's perspective,

. DATs—Decentralized Autonomous Tokens linked to creator or attention-driven economies—have seen rapid growth this year but are now considered at risk of a sharp downturn. Burniske , which resulted in $20 billion worth of crypto positions being wiped out, signaled the onset of a difficult capitulation period.

Ethereum News Update: Overleveraging and Retail Hype May Lead to a 50% Cryptocurrency Plunge image 0
Recent market statistics reinforce these apprehensions. to $1.93 billion in October, down sharply from $10.89 billion in September. for DAT inflows in 2025, with only $505 million reported so far. , lost $2.47 billion in November amid unprecedented outflows, indicating declining faith in crypto’s current direction.

These warnings have ignited discussion within the crypto sector. While some investors agree that inexperienced participants often panic and sell during turbulent times,

the ongoing evolution of the market. At the same time, Ethereum’s price struggles further highlight the instability of the present cycle. , sold close to 11,000 ETH to finance share repurchases, illustrating the mounting pressure on digital asset treasuries (DATs) as crypto prices falter.

Larger macroeconomic trends are also at play.

in November has failed to halt the ongoing market slide, with dropping below $85,500—a 7% fall in just 24 hours and a 20% loss over the past month. Meanwhile, Ark Invest has taken a contrarian approach, putting $40 million into crypto-related stocks such as Bullish and Circle as their prices dropped, signaling confidence in long-term prospects despite current setbacks.

QwQiao’s alerts are part of a broader trend of caution among experienced investors. He has previously

and speculative retail activity before a healthy bull market can return. With ongoing macroeconomic uncertainty and rising ETF outflows, the market could be heading for a deeper correction than many anticipate. , "it will now fall all the way".

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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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