Since last Friday’s close, bitcoin has fallen about 8%, from roughly $75,850 to the mid-$69,000s, after briefly dipping to around $67,700 as of Friday morning EDT, its lowest level since August. Equities went the other way.
Through Thursday’s close, the S&P 500 rose about 2.9%, the Nasdaq 3.2% and the Dow 2%, even as Nvidia sank nearly 11% as the scandal around Jensen Huang continued to unfold. More on that later.
Oil whipsawed on Middle East headlines. Gold fell about 4.7% to $3,885.30 due to rising yields and a stronger dollar. Spot gold briefly hit its lowest since October 2025. Treasuries sold off as markets priced in more Fed hikes.
The liquidity picture helps explain Bitcoin’s weakness. USDT supply is down $6.6 billion over 60 days. Roughly $7 billion has left stablecoins since the Binance hack, the biggest drawdown since 2022. One excellent trading account on X argues that funds remain constrained after 10/10, collateral is spread more thinly from the growth of stock and RWA derivatives, while hacks, fees and launchpads keep draining capital out of the ecosystem.
Spot bitcoin ETF flows are negative on a 12-month trailing basis too. The peak? October 2025, of course. This despite Barron’s report that security concerns are driving large holders toward in-kind ETF conversions. The existing bitcoin moving into an ETF wrapper isn’t likely new demand.
Some consolation for bitcoin could be the fact that it made highs not seen since January 2026 against Nvidia!
Last week’s newsletter did not address (former) Nvidia CEO Jensen Huang’s headline-grabbing news stories because it was A) about AI and B) more importantly, it centered around tawdry extramarital shenanigans, and C) although it allegedly involves a CCP spy, it didn’t seem like it was going to be that big of a deal. This week it is not possible to avoid since it is the proximate cause of bitcoin’s fall.
On Wednesday of this week a second affair was reported, this time with someone who reports directly to Mr. Huang. On Thursday, Mr. Huang announced his resignation, with CFO Colette Kress taking over on an interim basis. A third affair was reported soon after, although it seems likely there will be more.
The market damage is substantial. On Monday, Nvidia fell 4.27% while the Nasdaq gained 2.74%. Nvidia fell about 14% at Thursday’s open before closing down 4.34%. Its weekly loss erased roughly $490 billion in market value.
In macroeconomics, as mentioned before, gold fell alongside equities while the dollar strengthened. Gold’s price action is cause for concern, or as Luke Gromen put it somewhat hyperbolically:
“Gold’s price action should scare the absolute daylights out of investors. It is telling us something really wicked this way comes. “If you’re not [scared by gold’s price action], you’re not paying attention.”
The Federal Reserve via Fed Governor Christopher Waller telegraphed future hawkishness (yield hikes) attributable to research suggesting oil shocks now transmit more strongly into core inflation. Northstar’s oil forecast envisages $200-$400 over several years, but not an imminent spike.
The dollar’s supposed demise remains elusive. Bloomberg reported that Russia’s attempt to substitute yuan for dollars had faltered under U.S. secondary sanctions. The stronger dollar is not good for equities, nor for Bitcoin and digital assets.
Speaking of bad things for Bitcoin, MSCI decided to drop Strategy from its USA Index and Metaplanet from its Japan Small Cap Index at the Nov. 30 close. This will hamper several of the largest persistent buyers of bitcoin, especially if other index providers follow. It lands as corporate holders are already pulling back: public companies sold a net 11,647 BTC, worth about $869 million, between Nov. 2 and 8.
In policy, Senate Democrats are mulling a 10% credit-card interest cap. This sounds like a disastrous policy for both financial businesses and consumers, but it would be huge for stablecoins. Unable to properly price risk of defaults, credit card issuers would be forced to cancel all but the most pristine credit score holders. Stablecoin-based debit cards can move money more cheaply, although they don’t replace an unsecured credit line. On the other hand, 20 crypto-card providers/neobanks closed just this year.
Banks, meanwhile, reportedly plan a $270 million stablecoin venture involving 21 institutions, including Goldman Sachs, Citi and Wells Fargo.
Tokenization keeps advancing despite the market. The NYSE-affiliated platform selected Avalanche for clearing and settlement infrastructure, subject to approval. Avalanche was likely chosen because its subnets offer highly configurable controls, compliance and predictable costs. A far cry from Bitcoin or Ethereum mainnet. Tokenized-equity supply reached $4.7 billion, up $932 million in a week. Jupiter’s reported figures are particularly interesting: 62% of its tokenized-stock volume occurred outside regular market hours.
Coinbase secured OCC approval for its national trust company, a federal custody charter, not a general retail-banking license. After last week’s stock-market punishment, that is tangible progress.
In defi, Hyperliquid’s institutional endorsements haven’t prevented serious questions about its trading conditions. There’s also the fact that Hyperliquid has had so many huge catalysts recently, it’s hard to imagine what will top them moving forward.
Alt-L1 MegaETH rebranded as The Mega Company and committed $30 million to an inference-provider market. Another crypto project has discovered AI. Mysten’s Evan Cheng offered a more substantive case for rebuilding infrastructure around software agents, including permissions and liability when an agent goes wrong.
Ethereum supplied two contrasting narratives. Joseph Lubin pitched ETH as a superior store of value, combining programmability with claims of being despot-proof and eventually quantum-safe. He expects quantum- and AI-safe ETH by late 2027 or mid-2028. Meanwhile, the Foundation’s bizarre seppuku-language mandate prompted disbelief, a retaliation complaint, and a longer account of internal dissent.
Privacy remains a strong narrative. Helius announced Solana Privacy Rings live on mainnet, offering encrypted on-chain environments. Grayscale bought Wall Street Journal advertising for Zcash, while Taiki Maeda closed his leveraged ZEC longs but kept spot holdings, retaining his 2027 thesis.
Memecoins keep the familiar extraction economy continuing. A chart of Pump.fun’s paid callouts showed a brief 6% spike followed by a 48% decline an hour later. The Sahil files supplied allegations about many crypto promoters and pumped and dumped coins.
Pulsechain supporters explained Richard Heart’s reported detention as market timing, an elaborate illusion, or 9D chess, while another account alleged a legal-fundraising scam.
Finally, security and enforcement. Scrutiny of MEXC escalated into announced FinCEN restrictions, following longstanding criticism. Treasury’s published figure is at least $16 billion in allegedly illicit flows. Its order targets transfers involving MEXC through U.S. financial institutions, rather than establishing the blanket global prohibition implied by some headlines.
Infrastructure failures continued outside crypto. Outages hit 128 Japanese credit unions, interrupting withdrawals and transactions. Microsoft investigated Exchange Online access failures, then said its attempted fixes weren’t working as expected, directing users to service-status information. Yes, the notices describe outages, but the ongoing prolonged nature implies cyberattacks.
Gnosis Pay announced a data breach that exposed customer names, home addresses, card numbers and linked wallets. It is always particularly dangerous when a data leak connects a customer name and address to a crypto account.
The physical danger of wrench attacks was illustrated by a wild tale of a French crypto holder sentenced to 30 months after firing at would-be kidnappers. He had reportedly survived a previous kidnapping. The fuller account describes disputed self-defense, danger to bystanders and a prior conviction.
Stay safe out there.
-David Sencil
