Bitcoin is on track for its worst monthly performance since the 2022 wave of corporate collapses that shook the cryptocurrency industry.

Data compiled by Bloomberg shows the largest cryptocurrency by market cap dropped as much as 6.4% to $81,629 on Friday before paring losses, trading at $84,166 by 7:42 a.m. London time. Ethereum, meanwhile, plunged 7.6%, falling below the $2,700 threshold.

Year-to-date, Bitcoin has lost about 23% in November—marking its steepest monthly decline since June 2022. That month followed the collapse of TerraUSD, a stablecoin project led by Do Kwon, which triggered a chain reaction of corporate failures culminating in the bankruptcy of Sam Bankman-Fried’s FTX exchange.

Despite the pro-crypto stance of the U.S. administration under President Donald Trump and growing institutional adoption, Bitcoin has plummeted more than 30% since hitting an all-time high in early October.

The sell-off was sparked by a massive liquidation event on October 10, which wiped out $19 billion in leveraged token positions and erased roughly $1.5 trillion from the total crypto market capitalization.

Selling pressure intensified further in the past 24 hours, with an additional $2 billion in leveraged positions liquidated, according to CoinGlass data.

Institutions appear reluctant to "buy the dip." Twelve U.S.-listed Bitcoin exchange-traded funds (ETFs) saw $903 million in net outflows on Thursday—the second-largest daily redemption since their launch in January 2024. Open interest in perpetual futures has dropped 35% from its October peak of $94 billion.

The broader market environment has also turned unfavorable for cryptocurrencies. Earlier, U.S. equities rallied as optimism around artificial intelligence resurged following Nvidia Corp.’s strong earnings report. However, stocks later gave up gains amid concerns over stretched valuations and doubts about the Federal Reserve’s potential rate cuts in December.

"Market sentiment is extremely bearish right now. There seems to be forced selling in play, and it’s unclear how extensive it could get," said Pratik Kala, portfolio manager at Australian hedge fund Apollo Crypto.

Tony Sycamore, an analyst at IG Australia, noted in a report that the market "may still be testing MicroStrategy’s pain threshold"—referring to the original Bitcoin holding entity operated by Michael Saylor. He added that this scenario is significant because further declines toward the company’s breakeven price could trigger margin calls on its leveraged holdings. Shares of MicroStrategy Inc. fell 5% on Thursday.