CoinSignals

Bitcoin briefly dipped toward $74,000 over the past 24 hours before rebounding above $76,800, marking a 13% loss for the week. Analysts now point to a deeper bear market with a lower projected cycle bottom than previously expected.

Lower Cycle Expectations

Prominent crypto analyst Doctor Profit has revised his forecast for Bitcoin’s cycle low, placing it between $54,000 and $44,000. He cites the recent drop below the 100-week moving average (MA100 Weekly) as a critical signal, noting that this indicator has historically separated bull and bear market conditions. BTC’s break above the MA100 Weekly in October 2023 confirmed the prior bull market, and now losing it again signals a transition into a bear market.

Doctor Profit also highlighted the formation of a death cross and a confirmed breakdown from a bearish flag pattern, which mirrors the market structure seen during the 2021–2022 cycle peak. He expects Bitcoin to close the coming week below the MA100 Weekly, consolidate, and then continue lower toward $70,000, which he does not consider the true cycle bottom. Based on updated models, he now identifies $54,000–$44,000 as the most likely area for the ultimate low.

He also noted additional market pressure from Strategy, a firm that acquired a significant portion of its Bitcoin using leverage. The decline of the firm’s stock, used as collateral, has made stabilization more difficult, with BTC currently below Strategy’s average entry price of around $76,000. Doctor Profit warned that external narratives, such as speculation around Epstein-related files, could also trigger emotional selling.

Weakening Institutional Demand

Matrixport added to the bearish outlook, pointing to declining demand from traditional investors through spot Bitcoin ETFs. The firm observed three consecutive months of net outflows, with the last meaningful inflows in July and a brief resurgence in October. Despite a broader gold rally and continued de-dollarization trends, ETF inflows have slowed, suggesting that Bitcoin may need a refreshed narrative to attract renewed interest from traditional finance before forming a durable bottom.

In summary, while BTC has rebounded above $76,000, multiple indicators suggest that the deeper cycle low is likely much lower, with the $54,000–$44,000 range emerging as the potential final bottom.

Crypto markets fell further over the weekend, entering bear market territory, and more volatility may be ahead. The sell-off accelerated after news of US President Trump’s nomination for Federal Reserve chair, Kevin Warsh, who is seen as hawkish and unlikely to cut interest rates as quickly or as much as investors had hoped due to his stance on inflation.

“This week is all about the labor market and earnings,” noted The Kobeissi Letter, highlighting that earnings season is underway while macroeconomic uncertainty remains elevated.

Key Economic Events Feb. 2–6

Monday brings the January ISM Manufacturing PMI report, providing insight into the health of the US manufacturing sector.

Labor market data will dominate the week, starting with December JOLTS Job Openings on Tuesday, Initial Jobless Claims on Thursday, and the January Jobs Report on Friday. Michael Reynolds of Glenmede pointed out that these reports are particularly important given last year’s government shutdown, which left gaps in the labor and inflation data. Markets are currently pricing in no further Fed rate cuts until June, but any unexpected weakness in the labor market could alter that outlook.

Corporate earnings will also influence markets this week, with major reports expected from Alphabet and Amazon, following a weaker-than-expected report from Microsoft.

Crypto Markets Hit Yearly Lows

Over $250 billion left the spot crypto market over the weekend, pushing total capitalization down to $2.67 trillion, the lowest since April 2025. All gains from the past nine months have been erased, and the four-year cycle pattern appears to remain intact.

Bitcoin briefly dipped below $76,000 in Monday’s Asian session, marking a nine-month low and a 40% drop from its all-time high. Ether also fell to $2,250, a 14% decline over the weekend and its lowest level since May 2025. Most altcoins have been hit hardest, now trading 70% to 80% below their peak as panic selling continues into the new week.

Last Saturday, cryptocurrency markets experienced one of the most intense sell-offs in recent months, resulting in over $2.5 billion in liquidated positions across Bitcoin, Ethereum, and major altcoins. While many may have assumed that this sharp drop was linked to Federal Reserve decisions or geopolitical tensions in the Middle East, analysts from The Kobeissi Letter have ruled out those factors. They argue that the crash was entirely driven by liquidity issues and market dynamics, rather than external macroeconomic or political events.

Typically, weekends see low trading volumes and minimal price action in major cryptocurrencies. Exceptions usually occur when significant news breaks while traditional markets are closed, such as political developments or unexpected announcements. However, last Saturday’s collapse lacked any obvious trigger of that nature. Bitcoin had already experienced a decline earlier in the week following the Fed’s decision to maintain interest rates and heightened tensions in the Middle East, yet it recovered slightly on Friday as precious metals markets stumbled. Despite this recovery, the cryptocurrency market suffered a sudden and severe crash the following day.

Liquidity Crisis Behind the Crash

The Kobeissi Letter explains that the meltdown was caused by a shortage of liquidity in highly leveraged markets. Analysts noted three distinct waves of forced liquidations that accounted for approximately $1.3 billion in losses over a span of just 12 hours. In markets with thin liquidity, even relatively small sell orders can create “air pockets,” where prices drop sharply because there are not enough buyers to absorb the selling pressure.

Herd-like behavior in the market also amplified the effect. Investor sentiment in crypto tends to swing quickly between extreme bullishness and extreme bearishness, and these emotional shifts can turn sharp corrections into cascading sell-offs. In this case, a combination of high leverage and rapidly changing sentiment created aggressive downward price swings across multiple assets.

Impact on Bitcoin and Altcoins

Bitcoin led the sell-off, dropping to just over $75,000, its lowest level since April last year. Ethereum plunged from roughly $2,800 to $2,250, and Ripple’s XRP fell to $1.50, marking a 14-month low. Many other altcoins followed suit, with tokens like SOL, XMR, LTC, SUI, LINK, and DOGE losing between 5% and 10% in a short period. Only a few smaller tokens, including HYPE, managed to post modest gains on the day, standing out as rare exceptions in an otherwise widespread market decline.

The total cryptocurrency market capitalization fell sharply, reflecting the massive sell-off. Over-leveraged traders bore the brunt of the losses, with forced liquidations exceeding $2.5 billion. This included more than $1.3 billion wiped out in just half a day, demonstrating how quickly leveraged positions can exacerbate market volatility.

Historical Context

Saturday’s liquidation event ranks among the top ten largest daily liquidation events in cryptocurrency history. While it is dwarfed by the $19 billion wiped out on October 10 during the major market crash of 2022, it still underscores how fragile leveraged markets can be. Analysts highlight that when liquidity is low and sentiment is extreme, even small shocks can trigger cascading price declines across both Bitcoin and altcoins.

Opportunities Amid the Chaos

Despite the panic, analysts suggest that these conditions can also create opportunities. The rapid swings in price and sentiment can allow traders and investors to capitalize on extreme emotional reactions, especially when market fundamentals remain intact. This perspective encourages a more disciplined approach, viewing sharp corrections not solely as losses but as potential entry points for those willing to manage risk carefully.

In summary, Saturday’s $2.5 billion wipeout was not the result of macroeconomic news or geopolitical tension, but a classic example of how liquidity constraints, high leverage, and herd-like investor behavior can combine to create dramatic market movements. It serves as a reminder that cryptocurrency markets remain highly volatile and that extreme caution is needed when trading leveraged positions.

Crypto markets faced a brutal weekend as Bitcoin, Ethereum, and Ripple’s XRP led a widespread sell-off that erased around $200 billion from the total market capitalization in a matter of hours. Bitcoin fell to just above $75,000, marking its lowest level since April of last year, while Ethereum dipped under $2,250 and XRP hit a 14-month low at $1.50. The crash has left both seasoned and new investors on edge, with many altcoins suffering double-digit losses as panic spread across the market.

Bitcoin’s Volatile Week

The week began with Bitcoin trading around $89,000 before dropping to $86,000 early on, marking a five-month low at the time. The asset recovered over the following days, climbing back above $90,000 just before Wednesday’s FOMC meeting. However, the Fed’s decision to pause interest rate cuts, combined with rising tensions in the Middle East, created selling pressure. On Thursday, BTC plunged to $81,000, its lowest level since July, after news of U.S. Navy movements near Iran intensified market uncertainty.

Friday brought a brief recovery as BTC climbed to around $84,000, but the respite was short-lived. On Saturday, Bitcoin traded sideways between $83,000 and $84,000 before suddenly crashing to just over $75,000. In total, BTC lost roughly $20,000 in less than two weeks. As of now, it has recovered slightly to $79,000 but is still down about 5% on the day, with a market capitalization below $1.6 trillion and dominance over altcoins at 57.4%.

Altcoins Experience Heavy Losses

Ethereum followed Bitcoin’s trend, dropping from $2,800 to $2,250. XRP fell sharply to $1.50, marking a low not seen in over a year. Other major altcoins, including SOL, XMR, LTC, SUI, LINK, and DOGE, also suffered steep declines, with losses ranging from 5% to 10% in just 24 hours. Only a few tokens, such as HYPE, posted modest gains, standing out as rare exceptions in an otherwise red market.

Market-Wide Impact

The total crypto market cap now stands at $2.7 trillion, reflecting the scale of the weekend sell-off. Over-leveraged traders were hit particularly hard, with billions liquidated in just a short span. Around $2.5 billion in leveraged positions were wiped out over the weekend, with another $800 million lost in the past 24 hours, mostly from long positions. The volatility highlights the risks traders face in highly leveraged crypto markets and underscores how quickly sentiment can shift in response to global events and regulatory news.

Looking Ahead

While the market’s rapid declines are concerning, some analysts see these events as part of crypto’s natural volatility cycle. Sharp corrections have historically been followed by periods of recovery, and market participants are watching closely for signs of stabilization. Investors may take the weekend’s turmoil as an opportunity to reassess positions, manage risk, and potentially enter positions during market weakness.

The events of this weekend serve as a stark reminder that cryptocurrency remains a highly volatile and fast-moving market, where both gains and losses can accumulate rapidly.

Crypto markets continue to face heavy losses, with Bitcoin falling below $75,000 for the first time in nearly a year and Ethereum dipping under $2,200.

Crypto’s Sharp Decline

Bitcoin traded above $90,000 just days ago, testing that level before the first FOMC meeting of the year. After failing to hold, possibly due to the Fed pausing rate cuts or rising geopolitical tensions, BTC dropped to $81,000, briefly rebounded to $84,000, and then fell below $76,000. By Monday, it hit a multi-month low of $74,400, losing over $15,000 in under a week and almost $10,000 in just 36 hours. Altcoins mirrored Bitcoin’s losses, with the total crypto market cap shedding $500 billion since Wednesday. Weekend liquidations hit more than $2.5 billion, with an additional $800 million lost in the past 24 hours.

Gold and Silver Take an Even Bigger Hit

Despite Bitcoin’s volatility, broader markets have also been unstable. Gold and silver, traditionally safe-haven assets, collapsed over the past few days. Silver dropped from over $121 to $70.5, while gold fell from $5,600 to $4,400, wiping out roughly $10 trillion in combined market value.

Perspective: Early in the Game

Even with crypto’s steep losses, precious metals still show much larger swings. Silver alone remains bigger than the combined market caps of Bitcoin and altcoins, and gold’s market cap exceeds crypto by more than ten times. This reinforces the idea that, despite recent declines, the crypto market may still be in its early stages.

Standard Chartered warns that stablecoins could drain up to $500 billion from bank deposits in developed markets by 2028. U.S. banks are increasingly at risk as stablecoin adoption grows, with total circulation up roughly 40% over the past year to over $300 billion.

Long-Term Funding Risks

Geoff Kendrick, head of crypto research at Standard Chartered, estimates that stablecoins could remove as much as $500 billion from banks in industrialized nations by 2028, equal to about one-third of the U.S. stablecoin market cap. Growth may accelerate if the Clarity Act, regulating digital assets, passes.

U.S. banks face additional pressure as payment systems and core banking services shift toward stablecoins. Yield rewards on stablecoins, like Coinbase’s 3.5% on USDC, are a major point of contention with bank lobbying groups.

Regional Banks Most Exposed

Using net interest margin as a measure of vulnerability, Kendrick identified regional U.S. banks as the most at risk. Huntington Bancshares, M&T Bank, Truist Financial, and Citizens Financial Group top the list. Smaller banks are more sensitive due to reliance on traditional lending.

Short-term indicators remain supportive, with regional banking stocks rising nearly 6% in January and potential interest rate cuts and stimulus aiding loan growth. However, Kendrick expects the shift toward stablecoins to continue long term. Tether and Circle hold only a small fraction of reserves in bank deposits, showing little redepositing, and individual bank exposure will depend on their response.

This marks the lowest reading for the sentiment index in more than a month.

Just weeks ago, Bitcoin was trading comfortably above $95,000, with market participants openly discussing the possibility of a first move into six figure territory in 2026. That optimism has since faded.

The rally failed to continue, and sellers took control as winter progressed, triggering multiple sharp declines that pushed BTC to a multi month low. As prices fell, overall market sentiment deteriorated rapidly.

Fear and Greed Turns Sharply Lower

The Bitcoin Fear and Greed Index measures investor sentiment using factors such as volatility, price momentum, Bitcoin dominance, and social media activity. Price action and momentum account for half of the index score, which ranges from zero for extreme fear to one hundred for extreme greed. Given recent price swings, the sharp drop in the index comes as little surprise.

Extreme fear now dominates the market. The index has remained below 30 since January 22, when the latest correction began. Following Saturday’s broad market sell off, which erased more than $2.5 billion in leveraged positions, the index fell to 14, its lowest level since mid December.

After briefly rebounding to $84,000 following Thursday’s decline, Bitcoin plunged again to $75,500. This level marked its lowest price since last April and represented a $20,000 drop from the $95,500 peak reached on January 18. Altcoins followed the same path, with many falling to levels not seen in over a year.

A Potential Opportunity

Before writing off Bitcoin entirely, history offers a different perspective. Warren Buffett has famously advised investors to be greedy when others are fearful and cautious when optimism runs high.

Past periods of extreme fear across Bitcoin and traditional markets have often been followed by sharp rebounds. Echoing this view, Robert Kiyosaki noted that wealthy investors tend to buy when markets are under stress, while less disciplined participants often sell in panic during downturns.

A new report suggests that excessive leverage was largely cleared out in the fourth quarter, while realized price indicators and profitability metrics point to a more resilient Bitcoin market structure.

Bitcoin is currently trading in a narrow range below $79,000, supported by broader macroeconomic momentum. Most digital assets have moved in a similar pattern, yet analysts remain optimistic about Bitcoin’s outlook.

According to a joint analysis from Coinbase and Glassnode, Bitcoin appears to be in a stronger position than many alternative cryptocurrencies, which are still recovering from the sharp market decline seen last October.

A Healthier Entry Into 2026 for Bitcoin

Coinbase and Glassnode argue that crypto markets are entering 2026 in better shape after excess leverage was mostly removed during the fourth quarter. This assessment is supported by several on chain indicators. One key metric, the entity adjusted Net Unrealized Profit and Loss, shows that investor sentiment dropped from a belief phase into anxiety following the October sell off and remained at that level throughout the quarter.

At the same time, Bitcoin’s realized price continued to climb into early 2026, signaling a rising aggregate cost basis across the market. Since the spot price remains above the realized price, the average holder is still sitting on unrealized gains rather than losses.

The Market Value to Realized Value ratio is currently near 1.5, indicating that Bitcoin is trading at about a 50 percent premium compared to its on chain cost basis.

Key On Chain Signals

During the fourth quarter of 2025, the portion of Bitcoin supply held at a profit declined sharply. The report noted that this suggests price levels between $80,000 and $85,000 likely functioned as an accumulation range for model driven strategies. It also highlighted shifts in both dormant and active supply dynamics.

Bitcoin supply that moved within the prior three months increased by 37 percent in the fourth quarter, while supply that had remained inactive for over a year decreased by 2 percent. This pattern points to a potential high velocity distribution phase during that time.

The Puell Multiple also dropped to 0.9 in the fourth quarter, indicating that miners were earning roughly 10 percent less than the average revenue of the previous year.

Finally, net long term holder positioning and changes in exchange balances together suggested profit taking activity between July and September. However, the report found no clear evidence that the same behavior continued through the fourth quarter of 2025.

Bitcoin’s struggles persist, closing January with a 10.17 percent loss and marking four consecutive monthly declines, the worst streak since November. The last time BTC endured four or more months in the red was during the 2018 bear market.

Just a few months ago, Bitcoin traded confidently above 100,000 dollars, hitting a new all-time high above 126,000 and fueling predictions of 150,000 to 200,000 by year-end. The optimism, however, was short-lived. October brought a 19 billion dollar wipeout, and Bitcoin never fully recovered.

Hopes for a rebound in early 2026 faltered. BTC briefly reached 95,000 before falling below 90,000. Within days, it dropped to 81,000, bounced to 84,000, and then plunged again to around 75,000, triggering billions in liquidations. Overall, Bitcoin lost about 20,000 dollars in less than two weeks.

Analysts remain divided on whether the market can still be considered bullish. Historically, similar streaks occurred during bear cycles, such as 2018–2019, when BTC hit repeated lows and bottomed after six losing months. If history repeats, Bitcoin could face further losses before a meaningful recovery.

Despite the challenges, there is cautious optimism. Historical patterns suggest stronger performance could emerge in Q2 and Q3, while some analysts believe Bitcoin may now follow a new cycle. February could offer early signs of a turnaround.

Bitcoin is often criticized for extreme volatility, but last week showed that traditional safe haven assets can swing sharply as well. Gold and silver erased billions of dollars from their market caps in just one trading session.

Gold entered the year at 4,300 dollars per ounce and surged to 5,600 by Thursday, a 30 percent increase in a month. Silver performed even better, climbing 70 percent from 72 to 122 dollars. However, the following 24 hours were brutal. Gold fell 16 percent to 4,700, while silver lost 40 percent, wiping nearly all its yearly gains. Even after partial rebounds to 4,900 and 85 dollars, both metals closed deeply in the red, showing uncharacteristic volatility for assets often considered stable.

The causes are debated, with some pointing to profit-taking and others to political events, such as Trump’s Fed Chair nominee, Kevin Warsh. Combined, gold and silver lost roughly 7 billion dollars in market cap more than twice the entire value of the crypto market.

Bitcoin itself also saw a sharp drop, sliding from over 90,000 to 81,000 dollars in about 24 hours. Crypto advocates, however, emphasized BTC’s resilience compared with gold and silver, noting that Bitcoin is still a “17-year-old technology” and early in its adoption. The episode sparked discussions about whether some precious metal investors might rotate into crypto as volatility in traditional markets becomes more evident.