Bitcoin plunges to 10-month low amid $2 billion liquidation wave

18:50

By: Dakir Madiha

Bitcoin plunges to 10-month low amid $2 billion liquidation wave

Bitcoin tumbled below $75,000 over the February 1-2, 2026 weekend, hitting its lowest level since April 2025 in a brutal sell-off that triggered over $2 billion in liquidations. The drop briefly pushed the world's largest institutional Bitcoin holder into nearly $1 billion in unrealized losses.

The cryptocurrency dipped to around $74,500 during thin weekend trading, per data from major trackers, marking a roughly 40% decline from its October 2025 all-time high of $126,296. This extends Bitcoin's monthly losing streak to four straight, the longest since 2018.

Analysts pinned the crash on macroeconomic pressures rather than a single trigger. BitBull Capital CEO Joe DiPasquale called it "macro-driven," citing rising real yields, a stronger dollar and fading risk appetite. President Trump's January 30 nomination of Kevin Warsh as next Federal Reserve chair amplified bearish sentiment, hinting at tighter policy ahead. "Once key technical support broke, the sell-off accelerated with derivative liquidations and automated selling," DiPasquale explained.

Investors liquidated $2.56 billion in Bitcoin positions recently, Reuters reported. Coinglass data showed Ethereum hit hardest at $961 million, with Bitcoin at $679 million. Over 335,000 traders faced wipeouts, 80-85% in long positions.

The rout directly stung Strategy (formerly MicroStrategy), top institutional holder with 712,647 BTC at an average cost of $76,037 each. At $74,500, unrealized losses neared $1 billion before prices rebounded. Executive Chairman Michael Saylor showed no signs of retreat, posting recently: "We buy real Bitcoin. We audit our custodians. We don't rehypothecate."

Spot Bitcoin ETFs faced heavy outflows, exceeding $1.6 billion in January alone per SoSoValue. Alternative.me's Fear & Greed Index plunged to 17, signaling extreme fear.

By February 3, Bitcoin clawed back to $78,000-$79,000. Zerocap analysts stayed "long-term constructive," viewing price action as liquidity-driven rather than structural distress. Galaxy Digital's Alex Thorn urged caution, spotting scant whale accumulation and warning of a potential slide to the 200-week moving average near $58,000 without strong buying.