Crypto Assets big dump disrupts Thanksgiving again, retail investors face family interrogations: It’s all your fault for recommending Cryptocurrency Trading back then.

The cryptocurrency market has seen $1 trillion in market capitalization evaporate, leading to awkward conversations at Thanksgiving tables. Bitcoin is poised to record its worst monthly performance since 2022, with the current trading price dropping from an all-time high of $126,000 in early October to around $88,000. Bitcoin ETFs listed in the U.S. have faced an outflow of $3.5 billion, as investors have begun to question the two bullish arguments regarding the Fed's interest rate cuts and institutional adoption. Retail investors from New Jersey to Texas are preparing to defend their crypto investments at family gatherings, a scene strikingly similar to that during the FTX collapse three years ago.

Market Fall and Family Struggles

The sharp adjustments in the crypto assets market are becoming an inevitable topic of discussion at American families' Thanksgiving gatherings. Following the huge rebound after Trump's election as president, Bitcoin is currently heading towards its worst monthly performance since 2022, with smaller coins facing similar declines. For retail traders, this has almost become a holiday tradition—promoting digital assets to friends and family throughout the year, only to encounter significant falls during the winter months, a pattern that has repeatedly occurred in the crypto market.

Three years ago, when Sam Bankman-Fried's FTX exchange collapsed, enthusiastic retail traders were forced to answer awkward questions about the future of Crypto Assets at family gatherings. Today, Bitcoin enthusiasts are preparing to face a similar dilemma. New Jersey investor Michael Smith expects to be asked, “Why are you still in this market?” The 48-year-old financial services sales professional is driving to Pittsburgh to spend Thanksgiving with in-laws, and he anticipates that his 15-year-old nephew will ask about Bitcoin and whether he should invest.

Although Smith has been investing in Crypto Assets since around 2016, he admits that he does not have all the answers. “People are generally feeling panic about the economy and the market right now,” Smith said, with his Bitcoin holdings peaking at around $25,000. “You hear all this talk about bubbles. It really hurts when you check your account.” This feeling is quite common among retail investors, especially those who have recommended Crypto Assets to their families.

Investor's Journey

The recent fall of Bitcoin has been both brief and severe – just weeks after hitting a historic high of over $126,000 at the beginning of October, the largest crypto asset is now trading at around $88,000. Meanwhile, Ethereum has dropped about 40% from its August peak. The reasons behind the correction are multifaceted, but one major factor is investors' skepticism regarding two key bullish arguments: the Fed's multiple interest rate cuts and the increasing institutional adoption. Without these catalysts, crypto asset prices have plummeted, with investors withdrawing over $3.5 billion from Bitcoin exchange-traded funds listed in the U.S.

Traders like Zach Lonergan are preparing to defend cryptocurrency in front of skeptical family members. The 31-year-old investor, who lives in Austin, started engaging with digital assets before the pandemic but significantly increased his Bitcoin holdings in 2022 and 2023. Now, his portfolio is entirely made up of Crypto Assets, with 85% being Bitcoin. He says he has the same conversation with his family every Thanksgiving and Christmas: What is Bitcoin? What is it used for? This gives him the opportunity to “spread a little gospel and show them how interesting it can be.”

Crypto Assets market adjustment key data

Bitcoin historical high: $126,000 (early October)

Current Bitcoin price: 88,000 USD (fall of 30.2%)

Ethereum has fallen approximately 40% from its August peak.

Bitcoin ETF capital outflow: 3.5 billion USD

Michael Smith's position peak: $25,000

Zach Lonnagan Bitcoin allocation: 85%

Longan is running a landscaping business, and the recent setback hasn't discouraged him; he compares it to his passion for the Texas A&M University football team. Despite the team's ups and downs, he continues to support them. “The story of my life is to be a human punching bag,” he said, "and then I say, 'Is that all you've got?' I love being resilient. I like the idea of Bitcoin winning, because it really tells everyone to stop pointing fingers.

Multiple Factors of Market Adjustment

The recent adjustment in the Crypto Assets market is due to several interconnected factors. The Fed's high interest rate policy may last longer than expected, weakening the appeal of risk assets like Crypto Assets. Meanwhile, the speed of institutional adoption has not met market expectations; although the participation of traditional financial institutions like BlackRock is important, it has not yet triggered a flood of institutional funds. This gap between expectations and reality has led the market to reprice the value of encrypted assets.

Technical analysis indicators show that Bitcoin triggered a large number of stop-loss orders after breaking below the critical psychological level of 100,000 USD, accelerating the downward momentum. The liquidation of leveraged positions further amplified the selling pressure, especially in the perpetual contract market, where the funding rate turned negative indicating that short positions are dominant. This technical selling pressure, combined with fundamental concerns, has created a vicious cycle, leading to a rapid deterioration in market sentiment.

From on-chain data, long-term holders are beginning to realize profits by transferring Bitcoin to exchanges, which has increased market supply. Glassnode data shows that addresses holding Bitcoin for over a year have recently reduced their positions, a pattern that has also appeared at previous market cycle tops. Meanwhile, the pace of new investors entering the market has slowed, with network growth indicators showing a decrease in the creation of new addresses, which has reduced new sources of demand.

Similarities of Historical Cycles

The current market environment bears similarities to several cycles in the history of Crypto Assets. Retail traders like Kyle Fegus from Minnesota are not very optimistic about Bitcoin's recent path. This 39-year-old investor runs a YouTube channel about encryption and remains a believer in the largest Crypto Asset, but he stated that he would not be surprised if Bitcoin falls further to around $65,000.

For him, the period around Thanksgiving often marks the top for Bitcoin - as was the case in 2017 and 2021. Families passionately discuss Crypto Assets at holiday gatherings, persuading new traders to put cash into the market, only to see the value of their investments fall in the following months. At that time, the influx of retail cash into the space led Wall Street professionals to raise alarms about a market bubble. Figus stated that he has some long positions in Bitcoin, but has mainly taken a wait-and-see approach in this recent cycle, holding cash.

Fergus said, “Some older generations ask me about Bitcoin mining - it has garnered increasing attention. When you start getting these kinds of questions, I begin to wonder if this is the peak.” This “barbershop conversation” indicator is widely circulated in the crypto community, and when the general public starts asking for investment advice, it often signifies that market enthusiasm has reached its peak, after which adjustments may follow.

Sociological Observations on Thanksgiving Conversations

The cryptocurrency conversations at Thanksgiving family gatherings reflect a broader social phenomenon. Chelsea von Schneiden, 44, from Connecticut, creates crypto content on TikTok and says she fears cryptocurrency discussions. In her three years of trading digital assets, she has convinced family and friends to buy in as well. “Now we have to go to Thanksgiving, sitting around the table, and everyone is looking at their phones, finding that Bitcoin and the altcoins they bought are either at the same level as two years ago or lower,” she said. “It's not an easy thing to explain.”

This dynamic of family conversations reveals the unique position of Crypto Assets as an investment asset class. Unlike stocks or bonds, the volatility and technical complexity of Crypto Assets make it a particularly sensitive topic during family gatherings. When prices fall, early adopters not only face financial losses but also endure social pressure to explain market dynamics to friends and family whom they had encouraged to invest.

Megan Ryanberry, 36, from Raleigh, North Carolina, has convinced her family, friends, and even her barber to invest in digital assets over the past few years. She said cryptocurrency is always the topic of conversation at her Thanksgiving gatherings. This year will be even more tense as she recently quit her nursing job to trade full-time. “I've made this my profession now, and they look at me like saying, 'What are you doing? The market is crashing,'” she said. “I do expect to get a lot of questions. I can only assure them that I truly believe in crypto assets and Bitcoin in the long run.”

Long-term Outlook and Investment Recommendations

Despite facing short-term challenges, many investors still maintain long-term confidence. The underlying technology of Crypto Assets continues to evolve, and the network security and adoption metrics of Bitcoin and Ethereum are steadily improving. Institutional participation, although slower than expected, is still progressing steadily, particularly in the areas of custody services and compliance products. Regulatory clarity is also improving, with multiple jurisdictions establishing clearer frameworks for digital assets.

For investors facing Thanksgiving conversations, financial advisors recommend taking a balanced approach. First, only invest what you can afford to lose, avoiding leverage or borrowing to invest in Crypto Assets. Second, take a long-term perspective, ignore short-term fluctuations, and focus on the fundamental indicators of network development and adoption. Third, diversify your investments; do not put all your funds into Crypto Assets, and maintain a traditional asset allocation.

From the perspective of market cycles, the current adjustment may be a healthy market consolidation that lays the foundation for the next round of rise. Historical data shows that Bitcoin has recovered its upward trend after each significant adjustment, although the recovery time and magnitude vary. For investors with a long-term vision, the current price level may represent an accumulation opportunity, especially for those who missed the early stages.

As American families gather for Thanksgiving this week, crypto assets will undoubtedly be a topic of discussion at many dinner tables. While the short-term price movements are disappointing, the conversation itself reflects how deeply digital assets have become integrated into mainstream financial discussions. From Michael Smith to Zach Lonergan, retail investors continue to advocate for this emerging asset class, believing that today's volatility is just a chapter in a long-term evolution. As the history of crypto assets has shown, market cycles come and go, but the narrative of technological innovation and financial transformation continues.