With No Bailouts and Stalled Bills, the Crypto Market Is Under Siege
With No Bailouts and Stalled Bills, the Crypto Market Is Under Siege
As Bitcoin slid to the $60,000 level, roughly $2.65 billion evaporated from the cryptocurrency market in a single day, with bearish signals strengthening simultaneously across derivatives markets and sentiment indicators.
According to investment media outlet FXStreet on February 6 (local time), the total cryptocurrency market capitalization fell to around $2.18 trillion even after Bitcoin (BTC) rebounded to about $65,000 following an intraday dip to $60,000. Across the broader market, a combination of large-scale liquidations, declining open interest, and the dominance of short positions is fueling extreme risk-off sentiment.
Over the past 24 hours, approximately 585,000 traders were forcibly liquidated in the derivatives market, with total liquidations reaching about $2.62 billion. The largest single liquidation was a BTC-USDT position on Binance worth $12.02 million. In the same period, derivatives market open interest fell to $95.73 billion, continuing a sharp contraction from the peak of $233.5 billion recorded on October 7 last year. The long-to-short ratio stands at 0.9594, indicating a short-position advantage.
Sentiment indicators are also pointing to a fear-driven phase. The Crypto Fear and Greed Index plunged to 5, entering the “Extreme Fear” zone. Meanwhile, the total market capitalization of altcoins remains below $1 trillion at around $900 billion, a pattern commonly interpreted as capital exiting altcoins or rotating toward Bitcoin during bearish markets.
The retreat of institutional investors is adding further pressure. U.S. spot Bitcoin ETFs saw $258 million in net outflows in a single day, pushing cumulative outflows for the month beyond $500 million. Adding to the cooling sentiment, Strategy reported a net loss of $12.6 billion and an operating loss of $17.4 billion in the fourth quarter of 2025, sending its share price down 17% in one day.
Policy and geopolitical factors are also amplifying uncertainty. Renewed tensions between the United States and Iran, delays in discussions surrounding the U.S. cryptocurrency market structure bill known as the CLARITY Act, and the U.S. Treasury’s decision to rule out additional Bitcoin purchases or rescue measures have left the market without a clear rebound catalyst. Caution is growing that volatility and weakness could persist until a strong directional recovery emerges.
*Disclaimer: This article is for investment reference only, and no responsibility is taken for investment losses based on this content. The information should be interpreted solely for informational purposes.*
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