Crypto Fear Could Cause an Unexpected November Rally

Data from Santiment shows that bearish views on Bitcoin, Ethereum, and especially XRP are peaking, which is often a sign of capitulation before a rebound. The Crypto Fear & Greed Index also plunged to its lowest level since February, but analysts like Samson Mow say long-term holders are accumulating as short-term investors exit. Additionally, Bitwise CIO Matt Hougan predicted a major crypto boom in 2026 driven by strong fundamentals like institutional adoption, stablecoins, and tokenization. He pointed out that while retail sentiment is subdued, traditional investors are increasingly entering the space through spot crypto ETFs.

Analysts See Crypto Rally Brewing

Crypto analysts and on-chain data suggest that an “unexpected November rally” may be on the horizon, despite the fact that fear continues to dominate the market. Market intelligence platform Santiment pointed out that social media sentiment toward major cryptocurrencies like Bitcoin, Ethereum, and XRP has turned increasingly bearish, which is often a precursor to market reversals when long-term holders absorb coins sold by short-term speculators.

Bitcoin’s online discussions are still evenly divided between bullish and bearish views, while Ethereum has just over 50% more bullish comments than bearish ones. XRP, however, has become one of the most negatively perceived assets, with less than half of social media comments showing optimism. 

Santiment described this as one of the most “fearful moments of 2025” for XRP. Despite this, the firm still suggested that such extreme sentiment could actually be a bullish sign, and could be a signal of the exhaustion of weaker hands.

The broader crypto market is still struggling with fear and uncertainty. The Crypto Fear & Greed Index, which measures overall investor sentiment, dropped to 15 out of 100 this week, which was its lowest reading since February and well within the “extreme fear” category. Analysts attribute this mood to the ongoing macroeconomic headwinds, including shifting capital flows and concerns about US fiscal policy as the government approaches the end of its shutdown period.

Crypto Fear and Greed Index

Joe Consorti of Horizon compared the current sentiment to 2022 levels, when Bitcoin was trading close to $18,000. Santiment explained that when retail investors sell into weakness, “key stakeholders scoop up the dropped coins and pump prices.”

Bitcoin advocate Samson Mow also believes the market is setting up for a stronger phase. He said that most of the selling is coming from newer investors who entered the market in the past 12 to 18 months and are taking profits, while long-term holders are using the dip to accumulate. “These are not Bitcoin buyers from first principles, but rather speculators that follow the news,” Mow explained, and added that this rotation of coins to more convicted holders sets the stage for a stronger market in 2026.

Crypto Boom Likely in 2026

Meanwhile, Bitwise Chief Investment Officer Matt Hougan says he is now more confident than ever that crypto markets will see a major boom in 2026, as the absence of a strong rally in late 2025 aligns with the typical four-year cycle that historically defined crypto bull and bear markets. At The Bridge conference in New York City, Hougan explained that a major rally at the end of 2025 would have risked triggering an earlier downturn in 2026, but since that hasn’t materialized, the setup for a strong year ahead looks even more convincing.

Hougan explained that growing momentum in key sectors — including the Bitcoin debasement trade, stablecoins, and tokenization — continues to strengthen the market’s long-term foundation. He also pointed to renewed excitement around decentralized finance as a potential catalyst for a DeFi revival in the coming year. 

Matt Hougan

“The underlying fundamentals are just so sound,” he said. “Institutional investment, regulatory progress, stablecoins, tokenization — those forces are too big to keep down. So I think 2026 will be a good year.”

Although Hougan is still optimistic about Bitcoin, Ethereum, and Solana setting new highs by 2026, his outlook is more measured than some of the more bullish forecasts made earlier this year. Analysts like Arthur Hayes and Tom Lee suggested that Bitcoin could reach $250,000 and Ethereum $15,000 by year’s end, but with Bitcoin trading close to $101,700 and Ethereum around $3,400, such targets would require extraordinary gains in a very short timeframe.

Hougan said the pullback is largely driven by disillusioned “crypto-native retail” investors, many of whom exited after facing setbacks from events like the FTX collapse, the failed meme coin hype cycle, and October’s liquidations. “Crypto native retail is depressed,” he said, and added that this group appears to be sitting out the current cycle. 

In contrast, traditional finance investors are showing more resilience and interest, with spot crypto ETF inflows climbing steadily. “Traditional retail, like my uncle, is moving into crypto — that part of retail is still alive,” Hougan said.