Bitcoin Falls Below $70,000 Amid Market Turmoil and ETF Flows
By John Nada·Feb 8, 2026·5 min read
Bitcoin has fallen below $70,000, erasing post-election gains amid market turmoil and negative ETF flows. The broader cryptocurrency market continues to face significant declines.
Bitcoin slipped below $70,000, erasing gains made after the 2024 election, amid a broader market sell-off. As of February 7, 2026, the cryptocurrency's price hovered around $69,000, recovering from a low near $60,000 but still reflecting a significant drop this week.
The decline followed a 'sell at any price' sentiment in the market, exacerbated by Gemini's decision to close operations in several regions and cut staff. The CoinDesk 20 index lost over 17% of its value within a week, with Bitcoin dropping approximately 16.5% in the same timeframe. Other cryptocurrencies faced even steeper losses, with Ether down 22.4%, BNB 23.4%, and Solana 25.2%.
The sell-off was marked by market-wide liquidations, described as the worst single-day drawdown for Bitcoin since the FTX collapse. Jasper De Maere, a desk strategist at Wintermute, noted that the market experienced manageable liquidations, yet the scale of the movement raised questions about underlying stress in the system. This turmoil coincided with a broader cross-asset deleveraging, impacting traditional assets as well.
In the wake of declining prices, analysts noted that the market's vulnerability was heightened by various factors, including negative sentiment surrounding major crypto exchanges. Gemini's announcement to cease operations in the U.K., European Union, and Australia, along with a 25% staff reduction, further dampened market sentiment. The firm will transition to withdrawal-only mode for impacted users, partnering with eToro for asset transfers. This news significantly affected traders' confidence, as Gemini has been a prominent player in the cryptocurrency space.
Market structure dynamics have also contributed to recent volatility, with Bitcoin's average 1% market depth falling to around $5 million from over $8 million in 2025, as reported by Kaiko research analyst Thomas Probst. A lower market depth can lead to more abrupt price movements, compounding the impact of negative sentiment. As traders navigate these turbulent waters, many are left questioning the sustainability of the current market dynamics.
De Maere highlighted that implied volatility in crypto options surged into the 99th percentile, indicating traders were rushing to buy protection against further declines. The pressure was particularly acute for Ether, which De Maere referred to as the 'epicenter of the pain.' He pointed out that traders’ positioning suggested expectations of continued turbulence for Bitcoin, with a potential trading range between $55,000 and $75,000. This volatility underscores the uncertainties that currently plague the cryptocurrency market.
Furthermore, flows in spot Bitcoin ETFs have turned negative, with about $1.25 billion in net outflows over three days. Jim Bianco from Bianco Research estimated that the average ETF cost basis is near $90,000, translating to about $15 billion in unrealized losses for holders. The significant outflows from Bitcoin ETFs have drawn attention, as they suggest a lack of confidence from institutional investors. Bianco remarked that Bitcoin's recent price action resembles that of software stocks, given the correlation observed.
Software stocks themselves faced declines this week, following Anthropic's release of a new automation tool impacting various industries. Major companies like Salesforce, Adobe, and ServiceNow saw their shares drop significantly, indicating a ripple effect across the tech sector. This correlation raises questions about the broader implications for Bitcoin and its relationship with traditional equities, particularly as market participants grapple with the convergence of digital and traditional asset classes.
Market analysts, including BTIG's Jonathan Krinsky, noted a growing correlation between Bitcoin and software stocks, suggesting that both have recently found tactical lows. Krinsky observed that Bitcoin's price bottomed around $60,000 and identified $73,000 as a critical level for a potential recovery. If Bitcoin can surpass this threshold, it might signal a more stable trading environment. Traders are closely monitoring these levels, as they may indicate future price movements.
Despite the volatility, the Trump administration’s continued pro-crypto stance, which previously helped Bitcoin reach an all-time high above $125,000, remains a factor in market dynamics. The administration's policies have fostered a more favorable environment for cryptocurrency investment, but the current market conditions reflect a complex interplay of factors that may challenge the cryptocurrency’s path to recovery.
As the market continues to navigate these turbulent waters, traders and investors are left pondering the implications of recent developments. The volatility observed in Bitcoin and the broader crypto markets serves as a reminder of the inherent risks associated with digital currencies. Institutional investors, in particular, are weighing their options in light of recent price movements and market sentiment.
The recent decline in Bitcoin's price has reignited discussions among market participants regarding the sustainability of crypto investments. While some analysts express optimism about potential recovery, others remain cautious, highlighting the importance of monitoring key resistance levels. The interplay between Bitcoin and traditional equities, particularly software stocks, may provide insights into the future trajectory of the cryptocurrency market.
As the dust settles from the recent sell-off, the focus now shifts to how Bitcoin and other cryptocurrencies will respond to the evolving market landscape. The ability of Bitcoin to reclaim critical price levels will likely influence trader sentiment and shape the future of the cryptocurrency market. For now, the market remains in a state of uncertainty, with traders and analysts alike watching closely for signs of stabilization and recovery in the weeks to come.