Analysis: The "1011" liquidation event and the increasingly difficult macro environment have become the main reasons for the recent fall.

On December 1, Bitcoin and Ether have erased all gains made this year—this marks a sharp downturn for a market that witnessed Bitcoin soar to a historic high of $126,000 just two months ago. VCs point out that there are two main reasons behind this round of correction: the clearing event on October 11 and an increasingly difficult macro environment. Rob Hadick, a general partner at Dragonfly, stated that the de-leveraging event triggered by low liquidity, poor risk management, and weak Oracle Machines or leverage mechanisms has caused significant losses and brought about great uncertainty. Boris Revsin, a general partner and managing director at Tribe Capital, shares the same view, describing it as a “leverage wash” that has created a chain reaction throughout the market. At the same time, the macro environment has also become less friendly: short-term rate cut expectations have faded, inflation remains stubborn, the job market is weakening, geopolitical risks are rising, and consumer pressures are increasing. VCs note that this series of factors has led to a weak performance in most risk assets over the past two months. Anirudh Pai, a partner at Robot Ventures, further emphasized concerns about a slowdown in the U.S. economy. Key growth indicators—including the Citi Economic Surprise Index and one-year inflation swaps (derivatives used for Hedging inflation risk)—have begun to weaken. Pai stated that this pattern has previously occurred ahead of recession worries, fueling broader risk aversion sentiment. Dan Matuszewski, co-founder of CMS Holdings, mentioned that aside from tokens supported by buyback mechanisms, there is almost no “incremental capital inflow” into the crypto market, except for DAT (digital asset treasury) companies. With new demand drying up and ETF inflows no longer providing effective support, price declines have accelerated.