Bitcoin Sees Largest Outflows Since 2022, Warning of Downside to $28,000

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Bitcoin (BTC) is facing intense selling pressure as it experiences its largest capital outflow since the 2022 bear market. Market experts are sharply divided between warnings of a further سقوط and optimism that the downturn is merely a temporary correction.

Paul Barron, host of the cryptocurrency-focused YouTube channel Paul Barron Network, said in a video uploaded on February 19 (local time) that “the pace of capital outflows in the crypto market is accelerating to levels seen during the previous bear market,” adding that “the market has reached a boiling point.” Barron noted that weakness in artificial intelligence (AI)-related assets has spread to broader risk assets, further pressuring Bitcoin’s price.

Michael Saylor, chairman of Strategy, described the current situation as a crypto winter but assessed that this one would be far milder and shorter than previous cycles. Strategy’s average purchase price for Bitcoin stands at around $76,000. Saylor emphasized that the company holds 2.5 years’ worth of cash reserves, enabling it to withstand market volatility. He maintained a long-term bullish stance, citing Bitcoin’s average annual return of over 70% during the past decade.

From a technical perspective, however, a far more pessimistic outlook has emerged. Bloomberg strategist Mike McGlone warned that Bitcoin could retreat to around $28,000, a level that previously saw the heaviest trading activity. McGlone pointed out that amid the Federal Reserve’s tightening stance and ongoing geopolitical crises, markets are undergoing a rotation from risk assets to safe-haven assets such as gold.

Macroeconomic uncertainty is also intensifying downside pressure. The end of Federal Reserve Chair Jerome Powell’s term and the nomination of Kevin Warsh as the next chair have heightened concerns over potential policy shifts. Geopolitical risks, including the possibility of war between the United States and Iran, are further unsettling investors. The altcoin market is also facing its worst selling pressure in five years, with net selling continuing for 13 consecutive months, making a Bitcoin recovery more challenging.

The cryptocurrency market is currently in the anger phase of its psychological cycle, and extreme volatility is expected to persist until the capital unwind in the AI sector is complete. With signs that investors on major platforms such as eToro are shifting assets into tokenized gold, a prolonged bottoming process for Bitcoin appears unavoidable.

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