Bitcoin’s price just took a huge hit, dropping from its crazy high of $126,000 in early October 2025 to $60,062 by February 5, 2026. This crypto king has lost 52% of its value, which has everyone wondering if it can still stand. The RSI technical indicator fell to 18, which means it is oversold and traders should be looking for a bottom. Ethereum and Solana also had terrible days, losing 24% to 26% in one session. People are taking money out of their accounts left and right, and even big names like Anthony Scaramucci from SkyBridge are asking on CNBC, “Is this it for Bitcoin?” Volumes are very low, liquidity is gone, and the whole crypto market has lost trillions. It feels like those long, cold winters in the past.
It’s not just one thing that went wrong; it’s a perfect storm of mistakes. Wasn’t Bitcoin supposed to be like “digital gold”? Not really, no. It’s down 28% in the last year, while real gold is up 72%, which blows up the whole inflation-hedge story. Instead, it sticks to things that are risky, like stocks. Do you remember Trump’s shocking tariff news from April 2025? The S&P fell only 4%, but Bitcoin fell 10%. When it is stressed out, it follows the Nasdaq, which destroys the myth of safety. Then Jerome Powell of the Fed keeps rates steady, Trump picks Kevin Warsh, a guy who likes tight money, and boom—selling panic like we’ve never seen since 2018. Bitcoin drops below $65,000, wiping out all gains made since the election.
It was a bloodbath because institutions were leaving. In January alone, Bitcoin ETFs lost $3 billion, after losing $7 billion in November and $2 billion in December. That’s more than $12 billion gone since the top. Deutsche Bank says that companies and funds are selling off because they don’t have enough cash. Even MicroStrategy copycats have stopped. According to analysts like Steven McClurg, miners are having to sell and shut down because their power bills are so high after the halving (rewards were cut in half). VC money for crypto? Gone. How much do you trade? In the bathroom. It’s a cruel squeeze.
There are darker clouds on the horizon for the long term. Quantum computers could break Bitcoin’s security, so companies like Bitwise are rushing to build defenses. But as their Rasmussen points out, the fear has already caused prices to drop. That four-year cycle? Peaks lead to dumps after peaks, and bears see another 60% drop coming. Leveraged blowups have killed billions, made it hard to get cash, and made things more volatile. Panic is spreading through derivatives. It’s funny that Trump’s “pro-crypto” actions, like reserves and regulations, caused inflation through tariffs, which made the dollar stronger and BTC less important. War in Ukraine and trade fights? Confidence killer. The fallout is bad for everyone. The exchanges’ income is falling. Startups are losing money quickly. Miners are changing their minds or giving up. Whales and businesses with too much debt? Destruction. Charts say a bounce is possible after being oversold, but the mood is one of giving up. Bulls hold on to past rebounds, but Bitcoin’s “invincible” aura is gone. Gold is doing well, and bonds are paying off. So what is BTC? Casino bet or store of value? Adoption stays the same, but security worries grow. $50,000 tests are coming up, and diehards are nibbling on dips. It’s time to figure out how much it’s worth: Real asset class or never-ending winter? For the economy to get better, the Fed needs to lower interest rates, Trump needs to ease tariffs, and tech needs to be fixed. Right now? Very dark.
