Cryptocurrency markets are witnessing extreme volatility as Bitcoin and other major tokens suffer sharp losses. Here’s a detailed analysis of the ongoing crypto crash.
The global selloff in technology equities has worsened and washed out risky bets across asset classes, causing the cryptocurrency market to suffer greatly.
Market Pressure and Investor Concerns
Concerns about possible further pressures in the industry are raised by the breakdown, which is also lowering the stock of businesses that have bitcoin and other digital assets on their balance sheets.
The oldest cryptocurrency, Bitcoin, has dropped about 16 months in the past day. Coinmarketcap statistics shows that Bitcoin dropped more than 16.33% from its peak of $71,802.46 to $60,074.20 on Friday. Bitcoin’s value has dropped by more than 52% from its peak four months ago at $126,198.07.
Bitcoin’s Worst Decline Since 2024
According to Avinash Shekhar, Co-Founder & CEO of Pi42, Bitcoin’s precipitous decline around the $60,000 region represents the worst period since late 2024. The asset is currently down almost half from its October 2025 top as significant liquidations and ongoing ETF outflows increase selling pressure. According to him, the market’s defensive tone has been strengthened by the repeated inability to maintain rebounds.
But by 10 a.m. IST on Friday, Bitcoin was trading at about $65,000, and its overall market valuation had dropped by almost 9% to $1.3 trillion. With $143 billion worth of Bitcoins exchanging hands in the past day, traded volumes have increased by more than 90%. In the cryptocurrency sector, Bitcoin holds a nearly 58% market share.
Macro Headwinds and Market Sentiment
As macro headwinds, ETF withdrawals, and on-chain stress combined to reduce risk appetite across digital assets, Bitcoin fell precipitously on Thursday and continued its brutal weeklong loss, according to Giottus CEO Vikram Subburaj. “The market’s mood is indicative of a traditional risk-off period. Price movement is dominated by macro uncertainty, little follow-through purchasing is seen, and liquidity is tightening.”
After indicating on the campaign trail that he would back cryptocurrency, Donald Trump won the US presidential election a month before to this crash, which was the weakest since October 2024. According to data released on Friday, February 6, not just Bitcoin but also Ethereum, BNB, Solana, XRP, Dogecoin, Cardano, and Bitcoin Cash all saw declines of 9–13 percent.
Crypto Market Capitalization Plunge
From its peak of over $4.39 trillion in October 2025, the cryptocurrency market’s entire market capitalization has plummeted to $2.22 trillion, a drop of more than $2 trillion. The last month alone has seen the burning of over $1 trillion. The recent decline in stocks and precious metals had an impact on sentiment toward cryptocurrency. The volatility of gold and silver has increased.
Lead quant analyst at Mudrex, who sees this as a “buy-on-dips” opportunity in Bitcoin, bears continue to dominate the cryptocurrency market due to softer US labor data and mounting concerns about excessive capital spending in the AI sector, which weighed on broader risk sentiment.
💹 Bitcoin & Crypto Market Highlights
- Bitcoin Low: $60,074.20 (16-month low)
- Peak Value: $126,198.07 (October 2025)
- Total Market Cap: $2.22 trillion (down $2 trillion)
- Trading Volume: $143 billion in 24 hours
- Other Tokens: Ethereum, BNB, Solana, XRP, Dogecoin, Cardano, Bitcoin Cash fell 9–13%
⚠️ Crypto Risks & Buy-on-Dips
- Market Tone: Bearish with liquidity tightening
- Macro Risks: US labor data soft, AI sector capital concerns
- Investor Strategy: Buy-on-dips opportunities suggested
- Volatility: High across crypto, stocks, and precious metals
Frequently Asked Questions
1. What caused the recent collapse of Bitcoin and other cryptocurrencies?
A worldwide selloff in technology equities, which extended to cryptocurrencies, was the cause of the catastrophe. The significant drops in all digital assets were also caused by macroeconomic uncertainties, heavy ETF withdrawals, and tightened liquidity.
2. How much has the price of Bitcoin dropped?
Bitcoin lost more than 52% of its value, from its peak of $126,198.07 (October 2025) to about $60,074.20. It fell more than sixteen percent in the last day alone, reaching a 16-month low.
3. How did the crash affect the cryptocurrency market as a whole?
The market capitalization of cryptocurrencies as a whole dropped to $2.22 trillion, losing over $2 trillion from its peak of $4.39 trillion in October 2025. Other popular tokens saw a 9–13% decline, including Ethereum, BNB, Solana, XRP, Dogecoin, Cardano, and Bitcoin Cash.
4. Are there any elements that might aid in the recovery of Bitcoin?
Because of its strong liquidity, continuous acceptance, and investor interest, analysts predict that Bitcoin may present purchasing opportunities during declines. However, because of risk-off attitude and macroeconomic worries, the market is still gloomy.
5. How is the crash affecting investors?
Heavy liquidations and ongoing withdrawals have exacerbated selling pressure, which has made investors wary. Trading volumes skyrocketed, indicating panic selling, but some analysts believe that long-term investors could benefit from “buy-on-dips” possibilities.
Conclusion
Due to macroeconomic challenges, ETF withdrawals, and dwindling investor confidence, the cryptocurrency market is going through its biggest decline in months, with Bitcoin and other leading tokens losing substantial value.
Analysts say that even while market sentiment is still negative, this time frame may also offer risk-tolerant individuals strategic buying opportunities. Before making decisions, investors should be cautious and keep a careful eye on market developments as volatility persists.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Please consult a professional before making investment decisions.
