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Bitcoin came under intense selling pressure, falling roughly 4,000 dollars within a few hours and sliding to its lowest level in 17 days. The move erased recent gains and highlighted how sensitive the market remains to macroeconomic and political developments.

The sell off followed fresh tariff actions from President Donald Trump after the Supreme Court of the United States ruled that several previously imposed tariffs exceeded executive authority. The court determined that emergency powers under the IEEPA could not be used to broadly levy import taxes. In response, Trump announced a temporary 10 percent global tariff under Section 122, a rarely used trade provision, and later increased it to 15 percent.

As seen during earlier trade disputes, the initial reaction over the weekend was muted. Bitcoin held relatively steady while traditional markets were closed. However, once futures trading resumed on Sunday, volatility returned quickly. The asset dropped from around 67,800 dollars to approximately 64,350 dollars on Bitstamp before stabilizing near the 66,000 dollar level.

Market analyst Ali Martinez pointed to several potential support zones if bearish momentum continues. Based on holder cost basis data, important levels to watch include 58,500 dollars, 54,440 dollars, and 41,500 dollars.

The broader crypto market followed Bitcoin lower. Many altcoins declined more than 5 percent during the same window. According to data from CoinGlass, nearly 500 million dollars in leveraged positions were liquidated, with long traders accounting for about 90 percent of the total.

Additional insights from Santiment show that open interest has fallen to 19.5 billion dollars, less than half of the 38.3 billion dollar peak recorded on January 14. The firm also noted that social media sentiment has quickly shifted toward fear and uncertainty among retail participants. Historically, such spikes in fear have sometimes preceded short term rebounds, though volatility is likely to remain elevated in the near term.

A packed economic calendar in the United States could bring additional volatility to digital asset markets as investors react to the latest round of trade tariffs announced by President Donald Trump.

Cryptocurrency prices have dropped sharply again, with Bitcoin falling more than 3,000 dollars within about an hour and erasing its weekend gains. The sell off follows renewed tariff measures, including a 15 percent global tariff introduced after the Supreme Court of the United States ruled that earlier sweeping tariffs exceeded presidential authority.

At the same time, geopolitical tensions between the United States and Iran remain elevated, adding pressure to oil markets and broader risk assets.

Key Economic Events This Week

Markets are adjusting not only to trade developments but also to rising tensions in the Middle East, with crypto markets sliding about 4 percent on Monday morning.

On Tuesday, February Consumer Confidence data will be released, offering insight into household sentiment and spending trends. In January, confidence fell to its lowest level since 2014 as concerns about employment conditions weighed on consumers.

Thursday will bring initial jobless claims data, which reflects conditions in the labor market, one of the core focuses of the Federal Reserve. On Friday, the January Producer Price Index will be published, providing a measure of wholesale inflation, another key factor for the central bank. Despite these updates, policymakers are widely expected to maintain their cautious stance.

In addition, Nvidia is scheduled to report earnings on Wednesday. While unlikely to shift markets dramatically, weaker demand for its chips could influence sentiment around artificial intelligence related assets.

Crypto Markets Under Pressure

Total cryptocurrency market capitalization has fallen about 4 percent to roughly 2.31 trillion dollars. Bitcoin dropped from 67,600 dollars to below 65,000 dollars within hours and remains near that level. The asset is now down more than 5 percent for the week and is testing support near the lower boundary of its recent trading range.

Ethereum has also declined, sliding to around 1,860 dollars, its lowest point since early February. Several major altcoins are facing steeper losses, including Solana, Cardano, Hyperliquid, and Chainlink.

South Korean regulators are under scrutiny after a major system failure at Bithumb exposed weaknesses in both internal controls and financial supervision. The incident involved an accounting error that temporarily reflected the distribution of 620,000 Bitcoin, far exceeding the exchange’s actual holdings of about 42,800 BTC.

Massive Credit Error During Promotion

The issue surfaced on February 6 during a promotional event when users were mistakenly credited with 2,000 BTC each instead of digital assets worth 2,000 won, approximately 1.38 dollars. The system recorded a total of 620,000 BTC as distributed, creating a discrepancy valued at roughly 1.3 billion dollars.

Despite multiple inspections by the Financial Services Commission and the Financial Supervisory Service in recent years, regulators failed to detect the vulnerability that allowed a single employee to execute large transfers without triggering safeguards.

Lawmakers, including Rep. Kang Min guk of the People Power Party and Rep. Han Chang min of the Social Democratic Party, criticized the oversight process, questioning whether past reviews were largely procedural and insufficiently rigorous. The Financial Supervisory Service has extended its investigation through February and is examining potential violations related to investor protection, anti money laundering compliance, and system management.

Bithumb CEO Lee Jae won acknowledged two previous smaller incidents that were later corrected, both of which are now under review.

Authorities, together with the Digital Asset eXchange Alliance, are also assessing internal controls at other major domestic exchanges, including Upbit, Coinone, Korbit, and GOPAX. The findings may influence upcoming industry guidelines and crypto related legislation.

Separate Case of Seized Bitcoin Recovered

In a separate incident reported by the Gwangju District Prosecutors’ Office, 320.8 BTC valued at about 40 billion won that had been seized in a criminal investigation went missing after prosecutors accidentally accessed a phishing site while checking a wallet. The funds were later returned on February 17, reportedly after the hacker failed to liquidate them.

The Bitcoin had originally been confiscated from individuals involved in operating an illegal overseas gambling platform between 2018 and 2021. Authorities continue to monitor domestic and international exchanges while tracking the hacker to prevent further security breaches.

Almost 3 million Bitcoin, valued at about 200 billion dollars and representing close to 15 percent of the circulating supply, is currently held on centralized exchanges. This means roughly one out of every six BTC remains under the custody of third party platforms, even after the collapse of FTX in 2022 and increased industry emphasis on self custody.

Binance Holds the Largest Share

According to data shared by crypto analyst Darkfost, exchange reserves have grown in parallel with the expansion of trading services. Many platforms now provide yield products, derivatives backed by collateral, and lending features, all of which require sizable Bitcoin reserves to support user liquidity.

Among exchanges, Binance controls the largest portion of Bitcoin held on centralized platforms, accounting for nearly 30 percent of that supply. Bitfinex follows with close to 20 percent. Robinhood and South Korea based Upbit each hold about 8.2 percent. Kraken, OKX, and Gemini round out the leading group, with individual shares ranging between 5 and 7 percent.

When looking at absolute figures from CoinGlass, Coinbase Pro holds around 792,000 BTC, making it the largest single exchange holder by volume. Binance follows with nearly 662,000 BTC, while Bitfinex holds approximately 430,000 BTC.

Darkfost noted that deep liquidity, fast order execution, and access to services such as lending and staking help explain why a significant portion of Bitcoin’s supply remains concentrated within centralized platforms. Earlier data from CryptoQuant showed that Binance accounted for more than 40 percent of spot and Bitcoin perpetual trading volume across major exchanges in 2025, including 25.4 trillion dollars in Bitcoin perpetual futures alone.

Shifting Balances Across Platforms

Although total exchange reserves remain high, recent flows show mixed trends. Over the past 30 days, overall exchange balances increased by nearly 16,990 BTC, according to CoinGlass. However, individual exchanges experienced different patterns. Binance added more than 22,000 BTC during that period, while OKX and Bithumb saw outflows of over 2,700 BTC and 3,600 BTC, respectively. Gemini recorded the largest decline, with balances falling by almost 13,900 BTC.

These developments come as exchanges adjust their business strategies and regulatory positioning. Kraken confidentially filed for an initial public offering with the U.S. Securities and Exchange Commission in November 2025 after completing an 800 million dollar funding round that valued the company at 20 billion dollars.

Meanwhile, Robinhood recently introduced a public testnet for Robinhood Chain in February 2026. The network is built on Ethereum Layer 2 infrastructure powered by Arbitrum and aims to accelerate the development of tokenized assets.

Although Bitcoin was designed as a decentralized asset, a significant portion of its supply is concentrated in the hands of a few major players. The largest single holder remains Satoshi Nakamoto, who is believed to control about 1.1 million Bitcoin. That represents roughly 5.5 percent of the total supply and is valued at around 75 billion dollars at current prices. These coins, mined in Bitcoin’s early days, have remained largely untouched.

Among active entities, Coinbase ranks near the top with 993,069 BTC held on chain, equal to about 5 percent of the circulating supply. These holdings include customer deposits and company reserves used for liquidity. Its competitor Binance reportedly custodies around 661,000 BTC, or 3.15 percent of the supply.

Institutional investors also control substantial amounts. Data from Arkham Intelligence indicates that BlackRock is the largest institutional holder, with 761,801 BTC valued at approximately 52 billion dollars. Other asset managers such as Fidelity Investments and Grayscale Investments also maintain large positions. Some of these holdings are kept in omnibus custodial accounts, which can obscure direct ownership. For example, Fidelity Custody appears to hold around 448,000 BTC, and part of Strategy corporate treasury of 715,000 BTC is reflected under Fidelity due to custody arrangements.

Beyond these firms, other public companies have built notable Bitcoin reserves. Mining company MARA Holdings and Japan based Metaplanet have accumulated meaningful stakes. Private corporations are also involved. Tether holds 96,369 BTC, while SpaceX reportedly owns 8,300 BTC as of August 2025.

Governments have also become significant holders, often through asset seizures. The United States leads with 328,000 BTC, much of it recovered from cases such as the Bitfinex hack, the Silk Road marketplace, and funds seized from hacker James Zhong. The government also obtained 127,000 BTC linked to the LuBian hacker address.

The United Kingdom holds 61,245 BTC, largely confiscated by the Metropolitan Police in 2018 from individuals connected to a large scale fraud case. Authorities in China seized 194,775 BTC from the PlusToken scheme in 2020, though it remains unclear whether those coins are still held or have been sold.

Ukraine has also seen substantial Bitcoin involvement. Since the conflict with Russia began, the country has received 22.8 million dollars in BTC donations. In addition, more than 700,000 Ukrainian public officials have declared Bitcoin ownership, collectively reporting holdings of about 46,351 BTC.

In early 2024, Germany seized 50,000 BTC from the piracy website Movie2k, but those coins were fully liquidated by mid year.

Despite fresh developments surrounding United States tariff policy, Bitcoin has remained relatively steady over the weekend, trading close to 68,000 dollars. Meanwhile, most large capitalization altcoins have shown limited movement, although Pi Network’s native token has declined once more.

Bitcoin Steady Around 68,000 Dollars

Last weekend, Bitcoin rebounded from a low near 65,200 dollars and climbed to almost 71,000 dollars within days, marking its first return to that level in about a week. However, as the new business week began, bearish pressure pushed the asset back down to around 65,600 dollars by Thursday.

A modest recovery followed on Friday and Saturday, with bulls driving the price to a short term high of approximately 68,800 dollars. These gains came despite renewed tariff tensions in the United States, which have previously triggered heightened volatility in crypto markets.

On Friday, the Supreme Court of the United States ruled that several tariffs imposed by Donald Trump were unlawful. In response, Trump criticized the decision and announced a new global tariff of 10 percent, later increasing it to 15 percent on Saturday.

Although Bitcoin has eased slightly from its recent peak, it continues to hover near 68,000 dollars. Additional volatility may emerge when futures markets reopen Sunday evening, similar to previous reactions during tariff related tensions involving the European Union and Greenland.

Bitcoin’s market capitalization currently stands at roughly 1.36 trillion dollars, according to CoinGecko, while its dominance over altcoins is about 56.6 percent.

Pi Token Under Pressure Again

Pi Network recently marked the first anniversary of its Open Network launch, yet the milestone has not supported its token price. PI has fallen about 6 percent in the past 24 hours and remains below 0.165 dollars, placing it among the weakest performers in the market.

Other notable declines include Ethereum Classic, Arbitrum, and Ethena, each posting sharper losses. In contrast, PIPPIN has surged more than 17 percent on the day, approaching 0.60 dollars.

Among larger capitalization assets, Dogecoin, Cardano, and HYPE have declined around 3 percent, while XRP and Chainlink have slipped modestly. Ethereum, Solana, TRON, and Bitcoin Cash have recorded minor gains.

The total cryptocurrency market capitalization remains above 2.4 trillion dollars, according to CoinGecko.

It has been more than three months since the first XRP ETF launched, yet investor demand appears to have largely disappeared. Over the past week, the ETFs tracking XRP have attracted minimal net inflows, highlighting waning interest. Meanwhile, the underlying token has struggled to sustain the short-lived price gains from the previous week and now trades over 10 percent lower.

Declining Interest in Ripple ETFs

When Canary Capital’s XRPC product debuted on November 13, 2025, it was met with strong investor enthusiasm, breaking the record for single-day trading volume for a new XRP ETF. Shortly afterward, four additional funds tracking the altcoin launched, and total inflows rapidly climbed past one billion dollars. However, that momentum has since stagnated, with several weeks recording net outflows rather than gains.

For instance, in the week ending January 23, investors withdrew 40.64 million dollars, followed by another 52.26 million dollars in the subsequent week. There was a brief positive period with 39.04 million dollars in net inflows, but since then, investor interest has largely vanished. On February 11, ETF activity reported no daily flows at all, with SoSoValue registering a clear “0.00 dollars” for the first time since the products were introduced. The following week, this lack of activity continued: February 17 and February 20 saw no flows, while February 18 recorded 2.21 million dollars in net outflows and February 19 only 4.05 million dollars in net inflows.

With Monday being a national holiday in the United States, half of the business days had no trading activity to report. As a result, cumulative net inflows have remained flat at approximately 1.23 billion dollars, demonstrating that ETF demand for XRP has largely disappeared despite the early excitement surrounding the products.

XRP Price Pullback

Last weekend, Ripple’s native token experienced a brief surge, reaching over 1.65 dollars and marking a multi-week peak even though ETFs showed minimal activity. This rally was short-lived, as XRP quickly lost momentum and returned to around 1.40 dollars mid-week, dipping below that level on several occasions. At the time of reporting, the token has managed to hold support near this range but is still down more than 10 percent over the week.

Investor behavior continues to be shaped by ETF inactivity and a market dominated by short traders, according to popular analyst CW. However, a recent report from Santiment suggests that XRP may currently be slightly undervalued based on the 30-day MVRV ratio. Additionally, the significant realized losses across the market could potentially set the stage for a notable price rebound. Historical trends indicate that similar periods of concentrated losses have preceded strong recoveries, including a 114 percent surge in 2022 under comparable conditions.

Since early October, Bitcoin has trended lower, losing more than half its value from its all time high to a multi year low of 60,000 dollars recorded on February 6. Although the asset has recovered slightly, it remains firmly negative on a year to date basis.

Data from Santiment highlights contrasting behavior among investor groups during the correction. Wallets holding between 10 and 10,000 BTC reduced their balances by 0.8 percent since the October peak. Meanwhile, smaller holders with 0.1 BTC or less increased their holdings by 2.5 percent over the same period.

Santiment noted that this divergence does not necessarily signal an imminent price rebound. The firm explained that a stronger recovery would likely require renewed accumulation from larger stakeholders, as rallies tend to lack momentum without significant capital support. Retail investors, however, remain active and now hold their highest combined balance in nearly two years.

ETF Flows Paint a Clearer Picture

Investor behavior in spot Bitcoin exchange traded funds has shown a more pronounced shift. In the two weeks before Bitcoin climbed above 126,000 dollars, more than 6 billion dollars flowed into these products. Since then, outflows have dominated, with several weeks recording net withdrawals exceeding 1 billion dollars.

During three consecutive weeks in early November, investors pulled out over 3.5 billion dollars. The negative trend extended into the new year, with five straight weeks of net outflows.

According to data from SoSoValue, 1.33 billion dollars exited spot Bitcoin ETFs in the week ending January 23, followed by another 1.49 billion dollars the next week. While recent weekly outflows have slowed to under 360 million dollars, total net inflows into spot Bitcoin ETFs have dropped from 62.77 billion dollars in early October to 54 billion dollars as of last Friday.

Cryptocurrency payments to suppliers of fentanyl precursor chemicals began decreasing in mid 2023, months before official overdose death figures started to fall. According to a new report from Chainalysis, blockchain data may offer an early indication of disruptions in illicit drug supply chains.

Early Signs of Supply Chain Stress

Chainalysis identified a noticeable drop in on chain payments linked to vendors that provide chemicals commonly used in fentanyl production. This decline occurred well before public health statistics reflected fewer fatalities. Because overdose data is often released with delays due to investigative and certification procedures, blockchain transaction trends may provide a lead time of three to six months between supply disruptions and reported mortality changes.

The report suggests that monitoring crypto payments to precursor suppliers could help law enforcement agencies and policymakers detect shifts in synthetic opioid supply earlier, complementing traditional indicators such as drug seizures and overdose reports.

At the same time, the firm recorded a sharp increase in cryptocurrency activity connected to suspected human trafficking networks. In 2025, crypto flows to identified services rose 85 percent year over year, reaching hundreds of millions of dollars. Much of this activity is concentrated in Southeast Asia, where trafficking operations intersect with scam compounds, online gambling platforms, and Chinese language money laundering networks operating largely through Telegram.

Chainalysis categorized four main types of suspected crypto enabled trafficking activity, including Telegram based international escort services believed to traffic individuals, labor placement agents recruiting workers for scam compounds, prostitution networks, and vendors of child sexual abuse material.

Payment Trends and Criminal Infrastructure

Payment behavior differs across categories. International escort services and prostitution networks rely heavily on stablecoins because of their price stability and ease of conversion. Vendors of child sexual abuse material have historically preferred Bitcoin but are increasingly turning to alternative Layer 1 networks and privacy focused assets such as Monero. Many also use instant exchangers that allow rapid token swaps without identity verification, making tracing more complex even though transaction patterns remain visible on chain.

Transaction size data points to varying operational scales. Nearly half of transfers linked to Telegram based international escort services exceeded 10,000 dollars, suggesting organized operations working at scale. Prostitution networks and labor placement agents more commonly recorded transactions between 1,000 and 10,000 dollars, which aligns with agency fees and cross border recruitment costs. Victims recruited through such channels are often forced into online fraud schemes under threat of violence, according to prior reporting cited in the analysis.

The report further found that some escort and recruitment services are connected to Chinese language money laundering networks and guarantee platforms that quickly convert stablecoins into local currencies, reducing exposure to potential asset freezes.

Within the child sexual abuse material sector, operators are increasingly adopting subscription models that typically charge less than 100 dollars per month to generate recurring revenue. Chainalysis also observed links between these networks and online extremist communities, along with the use of United States based web infrastructure to host public facing websites while operators may be located overseas.

Crypto venture firm Dragonfly Capital has closed its fourth investment fund with 650 million dollars, despite a challenging environment marked by falling token prices and weaker investor sentiment across the digital asset market.

The firm’s previous fund deployed 500 million dollars into startups including Polymarket, Rain, and Ethena. The new capital pool is expected to support early stage crypto investments at a time when venture activity in the sector has slowed and many firms are struggling to raise fresh funding, according to Fortune.

Co founder Haseeb Qureshi said the firm’s direct communication style has been a strength in an industry often criticized for hype and self promotion. He emphasized that speaking openly about their views has helped distinguish the firm in a crowded market.

Dragonfly has backed a range of crypto businesses, including Layer 1 blockchain project Avalanche and financial services company Amber Group. The firm has navigated several major industry disruptions, including the collapse of the Terra ecosystem, the bankruptcy of FTX, and its strategic shift away from China amid regulatory crackdowns.

Regulatory Scrutiny Over Tornado Cash Investment

Dragonfly also faced attention from the United States Department of Justice. In July 2025, prosecutors told a federal judge they were considering potential charges against employees of the firm, including general partner Tom Schmidt, in connection with a 2020 investment in Tornado Cash.

The comments were made by prosecutor Nathan Rehn to District Judge Katherine Polk Failla of the Southern District of New York during proceedings in the trial of Roman Storm, who was later convicted of operating an unlicensed money transmission business.

Qureshi stated that Dragonfly fully cooperated with the government investigation, which began in 2023, and said the firm was prepared to defend itself if charges were brought. The Justice Department ultimately decided not to pursue charges against Schmidt.