New York, Feb 5, 2026, 17:12 EST — After-hours
Bitcoin dropped sharply on Thursday, tumbling roughly 12% to $63,399 after dipping as low as $62,503—its lowest in months—as selling accelerated late in U.S. hours. The cryptocurrency had climbed to $73,406 earlier in the day.
The broader crypto market took a hit, with volatility ramping up sharply. According to CoinGecko, the global cryptocurrency market cap tumbled to around $2.27 trillion, slipping about 10.9% in the last 24 hours.
Forced liquidations — where leveraged bets get automatically closed as traders run out of margin — surpassed $1 billion in the last 24 hours, fueling the sell-off. “It’s clear the crypto market is now in full capitulation mode,” said Nic Puckrin, investment analyst and co-founder of Coin Bureau, suggesting the market is moving beyond a correction toward a deeper “reset.” Meanwhile, concerns over liquidity have resurfaced after President Donald Trump nominated Kevin Warsh for Federal Reserve chair. “The market fears a hawk with him,” noted Julius Baer analyst Manuel Villegas Franceschi. Reuters
ETF flows dragged on the market. According to BitcoinTreasuries.com, U.S. spot bitcoin ETFs—those that hold bitcoin outright—saw net outflows totaling roughly $578 million on Feb. 4. Most of the losses hit the biggest funds.
Other leading tokens tumbled alongside. Ether slipped roughly 11.6% to $1,856, and XRP plunged about 23% to $1.18.
Shares tied to crypto got slammed again after hours. Strategy plunged roughly 17%, while Coinbase shares slid about 13% as investors punished companies closely linked to token valuations and trading volumes.
Strategy’s day took a hit after it posted a larger loss for the fourth quarter. The company disclosed it held 713,502 bitcoins as of Feb. 1, with a total cost of $54.26 billion—working out to $76,052 per bitcoin, according to a filing.
Signs of strain are surfacing within the sector. Jim Bianco of Bianco Research remarked this week, “Winter continues until a new narrative emerges.” Gemini announced plans to cut its workforce by 25% and close operations in the UK, Europe, and Australia as it strives for a “path to profitability.” Investopedia
The market structure has shifted, marked by increased retail activity at peaks and dwindling tolerance during declines. “Crypto is now for normies,” said Steve Sosnick, chief strategist at Interactive Brokers, in an interview with Axios. He noted that newer investors tend to exit faster once the diversification argument falls flat. Axios
The main threat for bulls remains mechanical: mounting forced selling. If liquidations continue rising and ETFs see heavy redemptions, crypto could break through support levels that traditionally drew buyers, at least temporarily. On the flip side, after leverage is flushed out, rebounds tend to be sudden—and tough to predict.
Investors are weighing the policy outlook as well. Warsh, a former Fed governor, is poised to succeed Jerome Powell when his term wraps up in May, pending approval from the U.S. Senate Banking Committee.
Traders are now eyeing new ETF flow data for signs that forced selling might be slowing down. On the macro front, the Bureau of Labor Statistics rescheduled the January Employment Situation report to Feb. 11 due to a funding lapse, with the January CPI report moved to Feb. 13.
