An unusual plunge in Bitcoin

The global cryptocurrency market is being hit by an unprecedented wave of selling, sending Bitcoin, the world’s largest digital currency, into a steep free fall.

During the February 5 trading session in the US market, global investors rushed to offload assets, causing Bitcoin to drop as much as 8% within just a few hours.

The price quickly broke below $70,000, marking its lowest level since the start of the year.

This abrupt decline not only rattled retail investors but also spread across the entire crypto ecosystem, with billions of dollars liquidated in a short span of time.

By the morning of February 6, the situation had worsened further.

According to data from major exchanges such as Binance and Coinbase, Bitcoin continued to face heavy selling pressure from both institutional and individual investors.

As of 7:20 am on February 6 (Vietnam time), Bitcoin had fallen by more than 15%, touching $60,000 per BTC.

Compared with its peak of $125,000 in early October 2025, this represents a dramatic decline of over 50% in just a few months.

The current level is also the lowest in nearly a year and a half, since the major correction at the end of 2024.

The leading cryptocurrency is facing waves of forced liquidations, largely because many investors can no longer maintain margin requirements amid extreme price volatility.

Futures contracts on the CME and other derivatives platforms recorded hundreds of millions of dollars in liquidations over the past 24 hours.

Bitcoin is not alone in the downturn.

The entire crypto market is awash in deep red.

Ether (ETH) of Ethereum has fallen more than 12% in the past 24 hours.

XRP of Ripple is down 15%.

ADA of Cardano has lost 18%.

Solana (SOL) has dropped nearly 20%.

Global crypto market capitalization has evaporated by more than $500 billion over the past week and continued to shrink into February 6, standing at around $2.1 trillion.

Bitcoin’s own market capitalization has fallen to about $1.27 trillion.

This reflects widespread panic as capital flows out of high-risk assets into safer havens.

What is driving the sell-off

Several key factors are fueling the current wave of selling.

First is the weakening of institutional capital inflows.

Spot Bitcoin ETFs in the US, which had been a major driver of last year’s rally, are now seeing persistent net outflows.

On January 29 alone, more than $800 million was withdrawn from these funds, extending a trend that has lasted for three consecutive months.

Second, adverse global macroeconomic conditions are weighing on risk appetite.

Stubborn inflation in the US and Europe, prolonged high interest rates from the Federal Reserve, and geopolitical tensions in the Middle East and Asia have made investors increasingly risk-averse.

Third, Bitcoin supply has increased as miners sell holdings to cover costs following the most recent halving, combined with waning demand from traditional investors.

Finally, a domino effect from global equity markets has added pressure, with the S&P 500 falling 3% over the past week.

An unusual correction signal

Bitcoin’s current movement is more than a routine correction and may signal a deeper shift in investor confidence toward digital assets.

Many analysts say the decisive break below $70,000, a key technical and psychological support level, has shaken belief in Bitcoin’s long-term value for some investors.

Analysts at Deutsche Bank noted that steady and heavy selling throughout the past week suggests growing pessimism among traditional investors toward the crypto market.

Institutional investors, once expected to be a stabilizing force, are now leading the sell-off.

From a technical perspective, the clear breakdown below $70,000 has opened the door to a rapid slide toward the $60,000 zone, and even $50,000 in the most negative scenario.

The current price is testing the 2024 lows, an area that represents the cost basis for many long-term holders.

Historically, when Bitcoin enters this zone alongside extreme fear readings on the Fear & Greed Index, the market often stages a technical rebound to relieve selling pressure.

This time, however, strong ETF outflows and rising supply make any recovery more fragile.

On the other hand, some analysts remain cautiously optimistic.

They argue that bearish narratives have dominated for an extended period, raising the possibility of a counter-trend rebound.

For now, investors are closely watching the $60,000 level.

If this support holds, bottom-fishing demand from large investors and long-term holders may emerge.

If it fails, the risk of a deeper slide toward $50,000 is high, potentially extending the bear market by another six to twelve months.

Even so, the sell-off reflects the maturing nature of the crypto market, where macroeconomic forces and regulation play an increasingly decisive role.

Over the long term, if interest rates ease and the global economy stabilizes, Bitcoin may still recover, supported by its position as “digital gold.”

Manh Ha