Bitcoin Below $100K, Coinbase Slumps, Banks Strain — Not an AI Correction Anymore

As most of the attention on Wall Street stayed on whether the AI trade had finally gone too far, the most important move was happening somewhere else: in subprime auto defaults, regional bank funding lines, and margin calls in leveraged crypto positions.

Earlier in November, Bitcoin dipped under the psychologically important $100,000 mark for the first time since May, touched an intraday low just below that level, then recovered only slightly. Around the same time, Coinbase (NASDAQ:COIN) dropped nearly 7 percent in a single session and now trades well below its 50-day moving average.

And regional banks tapped emergency Fed lines. Three different markets with one clear message: liquidity is tightening, deleveraging is accelerating, and if you haven’t positioned defensively yet, here’s exactly what to do next.

Bitcoin, Nasdaq & AI Leaders Show Synchronized Decline: From Nov 1-13, 2025, all three asset classes fell together, with Bitcoin breaking below $100K while tech indices retreated. Normalized to 100 on Nov 1 for direct comparison. This cross-asset correlation signals a liquidity squeeze, not isolated crypto weakness

Bitcoin Is Trading Like a Liquidity Gauge, Not a Market Movement

For years, Bitcoin has been marketed as a hedge against inflation, politics, and even systemic risk. On days like this, it behaves much more like a high-beta barometer of global liquidity.

The recent move below $100,000 wasn’t a slow grind driven by weak fundamentals. It was a deleveraging event:

• Leveraged long positions were forced out as margin calls hit and liquidations rolled through derivatives venues.
• ETF outflows and short-term traders selling into weakness made the fall steeper.
• Order books were thin enough that each round of selling knocked through bids faster than in a calm market.

The result is that the 100,000 to 101,000 area has turned into an important short-term support band, while the 104,000 to 105,000 region has acted as a ceiling that buyers have not been able to clear.

Long-term holders, though, have not dumped their coins. On-chain data suggests that the most committed wallets are largely sitting tight. That points to stress at the margin, where borrowed money and short-term leverage live, rather than a collapse in long-term belief.

For traders, that is the tell. When an asset that is closely tied to speculative capital breaks a key level on forced selling, it usually marks the first place a broader liquidity squeeze shows up.

The Quiet Credit Squeeze Behind the Move

If you step away from the Bitcoin chart, the backdrop looks even more worrisome.

Over the past couple of months, the United States has seen a run of credit market problems that do not fit neatly into the AI narrative. A major subprime auto lender, Tricolor Holdings, filed for bankruptcy and forced write-downs at big banks such as JPMorgan Chase and Fifth Third. Losses and fraud-related issues have also surfaced at regional lenders, including First Citizens, Zions, and Western Alliance.

At the same time, some regional banks have started relying more on the Federal Reserve’s short-term liquidity backstops, drawing on facilities and repo lines that are designed for periods of stress rather than routine pullbacks. Even without obsessing over weekly usage data, the simple fact that banks are paying up for extra funding tells you something about the mood on their balance sheets.

Credit rating agencies are picking up similar signals in private credit. DBRS Morningstar and others have highlighted that downgrades in several pockets of private debt are now outpacing upgrades. Goldman Sachs Research still argues that recent defaults are not yet systemic, but it has acknowledged that bankruptcies and fraud headlines in late Q3 and early Q4 helped accelerate the selloff in risk assets.

Put together, this does not look like a market that is just cooling off after an AI boom. It looks like the early stage of a credit-driven liquidity squeeze that starts in subprime borrowers and regional banks, then moves outward along the risk spectrum.

When banks and private credit funds tighten lending standards and hoard cash instead of writing new deals, the first positions to go are the speculative ones: high beta tech, crypto, and the platforms that sit in the middle of those flows.

Coinbase: When the Plumbing Starts To Creak

If Bitcoin’s flirtation with sub-100K levels is the alarm bell, Coinbase’s price action is the wiring that connects it to the rest of the market.

That near 7 percent one-day drop in Coinbase, leaving the stock well under its 50-day moving average, tells a simple story: crypto’s core infrastructure still depends heavily on retail and fast money flows. Coinbase is not yet a sleepy, fee-driven utility that shrugs off volatility. When liquidity dries up and volumes fade, the business feels it.

If crypto adoption were truly institutional in the way some marketing suggests, you wouldn’t expect the leading United States exchange to swing this hard on a single day without a company-specific bombshell. The fact that it does points to how sensitive the ecosystem still is to changes in margin and risk appetite.

The divergence matters:

• Bitcoin has dropped sharply, but long-term holders have mostly stayed in place.
• Coinbase has been hit even harder, which reflects stress in the plumbing: custody, trading, and retail brokerage activity.

In healthy adoption phases, infrastructure tends to be more stable than the asset it supports. Right now, the opposite is true, and that should get traders’ attention.

AI, Trade Tensions, and the Same Liquidity Problem

None of this means AI valuations suddenly stopped mattering. High-growth leaders such as Nvidia, Broadcom, and other chip names were always vulnerable to any wobble in macro data or policy.

United States export controls to China have already closed off an important demand channel for advanced chips. Big cloud customers are also exploring their own custom accelerators, which raises questions about how long current growth rates can last. On top of that, valuations are still rich, so even small disappointments can trigger large reductions in risk.

Trade policy only adds to that pressure. The Liberation Day tariffs from April and China’s roughly 34 percent response have not gone away. With the political cycle heating up and both sides taking a firm line, semiconductor and AI chip exporters now carry a political risk premium as well as valuation and growth risk. For Nvidia (NASDAQ:NVDA), that can turn a routine correction into the early stages of a structural bear case if tensions increase.

On top of all of that, the data calendar is bunched up. The long government shutdown has left investors flying partly blind on inflation, jobs, and growth. Key releases, including CPI, weekly jobless claims, and the monthly payrolls report, are jammed into the back half of November and early December. Until that information arrives, markets are guessing about the true macro picture.

In that setting, the next Nvidia earnings report later this month becomes an even bigger catalyst. Very strong data center and AI revenue could calm nerves and spark a sharp rally. Cautious guidance on export limits, competition, or hyperscaler spending would do the opposite and reinforce the idea that the liquidity squeeze is not done.

This Is Not 2008, But the Plumbing Matters

Nobody is calling for a repeat of 2008 here.

Large United States banks are far better capitalized than they were before the global financial crisis. The Fed has a long list of lending tools it can use if real panic shows up. For now, funding markets are still functioning.

At the same time, serious problems rarely arrive all at once. They tend to show up first in the plumbing.

Subprime auto defaults, regional bank liquidity draws, more private credit downgrades, and pressure on crypto infrastructure are part of that slow drip. Bitcoin’s break below 100,000 dollars, and its struggle to get back through the 104,000 to 105,000 band, are the chart version of that story.

You do not have to believe a crisis is around the corner to take that signal seriously.

Liquidity Stress Indicators To Watch

For traders, the challenge is to turn a broad story into something they can actually monitor. A few places to watch over the next several weeks:

• Regional bank risk and commercial real estate (CRE) exposure: Watch price action and rating commentary on regional banks with large commercial real estate and consumer loan books. Negative outlooks or downgrades there are a sign that localized stress is spreading.
• Fed facility usage and money markets: Follow commentary and available data on bank use of Fed liquidity backstops and repo lines. A steady climb in usage, outside of normal quarter-end moves, suggests lenders are stockpiling cash rather than taking risk.
• High-yield credit spreads: If high-yield option-adjusted spreads break above recent ranges and keep widening, credit stress is becoming more systemic, not just a few isolated blowups.
• Crypto infrastructure versus Bitcoin: Compare the moves in Coinbase and major crypto ETFs to Bitcoin’s own price. If infrastructure stocks lag the asset badly, the plumbing is cracking faster than the asset itself, which is not what you would expect in a healthy adoption phase.
• Private credit commentary and flows: Listen for language about refinancing pressure, rising downgrades, or tighter terms on new deals on earnings calls from large private credit managers. That is where a lot of credit risk now sits.

None of these indicators, on their own, proves that a crisis is coming. Together, they say a lot about the direction of travel.

Key Liquidity Stress Indicators (as of Nov 13, 2025): Every metric is well above typical stress thresholds. It shows the systemic nature of this liquidity event, with both the banking system and crypto infrastructure under visible pressure.

A Tactical Setup for Risk Management

This backdrop does not mean traders need to dump every risk asset. It does argue for tighter risk management and some thoughtful hedging.

One example of a simple setup:

• A small pair trade that is long long-duration Treasuries through an ETF such as TLT and short the Nasdaq 100 through QQQ.
  The idea is that if the liquidity squeeze gets worse, high beta tech and AI names will feel more pain than long Treasuries, especially if growth expectations fall and the market leans harder into future Fed cuts.
• Signals to lighten up: if Bitcoin can climb back above the 104,000 to 105,000 zone and hold there, and credit spreads tighten, that would suggest the immediate stress phase is easing and the hedge can be reduced.
• Signals to add protection: if Coinbase breaks below recent support while high-yield spreads widen and Bitcoin struggles to stay above 100,000, that would suggest the squeeze is still building.

Position sizing should stay small, maybe one to two percent of a diversified portfolio, and stop losses should be respected. The goal is not to make a heroic macro call. It is to nudge the odds in your favor if the credit and liquidity story keeps getting worse.

What It All Adds Up To

This selloff is more than stretched AI valuations or a single inflation number.

The more convincing story is that markets are working through a layered reset in liquidity. Subprime autos, regional banks, private credit, Bitcoin, Coinbase, and crowded AI trades are all different versions of the same theme: funding is becoming more selective, and the weakest links are getting pulled first.

Whether this episode stops at a correction or grows into something larger will depend less on the next AI headline and more on what happens in the plumbing. Regional bank funding needs, private credit downgrades, and cross asset risk appetite will matter more than the next sound bite.

Bitcoin’s dip below 100,000 dollars may not end the crypto bull run. It may end up being remembered as the moment markets started taking the credit story more seriously than the AI story.