From what I can tell, it is 25% of CURRENT health and not MAX health. Otherwise you could potentially just bring a team full of Mastemon and spam Chaos Degradation to win about 90% of fights (except for, like two of them, Lucemon's third form and Imperialdramon Paladin Mode once he goes berserk and spams his signature move) in 4 turns
What really bothers me is that the health bar reduction does not look like it was 25%. More like 20%.
From what I can tell, it is 25% of CURRENT health and not MAX health. Otherwise you could potentially just bring a team full of Mastemon and spam Chaos Degradation to win about 90% of fights (except for, like two of them, Lucemon's third form and Imperialdramon Paladin Mode once he goes berserk and spams his signature move) in 4 turns