New York, Feb 5, 2026, 13:34 EST — Regular session
- Bitcoin dropped roughly 10.5%, falling below the $70,000 mark to $65,713
- Traders flagged concerns about tighter Fed liquidity with Kevin Warsh in the picture, alongside ongoing ETF selling pressure
- Shares tied to crypto, like Strategy, dropped as the selloff extended past just tokens
Bitcoin dropped over 10% on Thursday, deepening a steep selloff that dragged the cryptocurrency below $70,000, nearing its lowest point since late 2024.
The sell-off is putting risk appetite to the test. Traders are adjusting their views on U.S. liquidity following President Donald Trump’s pick of Kevin Warsh as the next Federal Reserve chair, alongside ongoing outflows from bitcoin funds. “The market fears a hawk with him,” said Manuel Villegas Franceschi of Julius Baer’s next generation research team. He added that a leaner Fed balance sheet wouldn’t offer “tailwinds” for crypto. (Reuters)
Bitcoin dipped 10.5% to $65,713, having earlier slid to $65,431. Ether dropped roughly 10%, landing at $1,926.
Part of the selling pressure has come from exchange-traded funds, or ETFs—these listed products offer bitcoin exposure without owning the coins outright. Deutsche Bank analysts pointed to “massive withdrawals” from institutional ETFs as a key factor behind the broader drop. They noted that U.S. spot bitcoin ETFs experienced over $3 billion in outflows during January, following similar withdrawals in December and November. (Investing)
Thursday’s drop mirrored a wider pullback from risk, as stocks fell and investors sifted through earnings reports along with labor-market data. (Investopedia)
Bitcoin’s $70,000 level has stood as a key psychological barrier for months. If it falls below that, what’s been a gradual slide could trigger forced selling, with leveraged traders liquidating positions and systematic funds pulling back exposure.
The selloff is hitting crypto-linked stocks. Strategy, the top bitcoin holder among public companies, took a steep dive. Other firms with “digital asset treasury” holdings also saw shares slide, Reuters reported. (Reuters)
“As Bitcoin dips below the key $70,000 mark, it’s obvious the crypto market has entered full capitulation mode,” said Nic Puckrin, investment analyst and Coin Bureau co-founder, referring to the chaotic selling traders associate with a washout low. (Reuters)
That said, the path forward might not be straightforward. Should equity markets settle or investors conclude the Fed chair transition will be more gradual and less forceful than expected, bitcoin could bounce back sharply. On the flip side, persistent ETF outflows and a drop below $70,000 might trigger new selling pressure.
Investors are eyeing daily U.S. spot bitcoin ETF flow data, fresh signals on the Fed’s balance sheet, and the upcoming U.S. “Employment Situation” report on Feb. 11 for insights on rates and risk assets. (Bureau of Labor Statistics)
Traders are closely eyeing whether bitcoin can reclaim $70,000 or if breaking below will turn that mark into fresh resistance.
