Bitcoin’s steep drop to $86,099 erased $1.06 billion from the crypto market, with long positions bearing the brunt of the losses, totaling $873 million.
Data from Coinglass on Feb. 26 reveals that around 230,000 traders were liquidated in the past 24 hours. Open interest has fallen by 5%, signaling a broad market deleveraging. Exchange inflows have surged by 14.2%, hinting at increased panic selling. Additionally, funding rates have turned negative, reflecting a shift in investor sentiment.
The sell-off coincided with significant withdrawals from U.S. spot Bitcoin ETFs. Over five days, outflows reached $1.1 billion, including $516 million lost on Feb. 24 alone.
Crypto-related stocks also took a hit. Coinbase (COIN) dropped 6.4%, Robinhood (HOOD) fell 8%, and Bitcoin mining firms Bitdeer (BTDR) and Marathon Digital (MARA) saw declines of 29% and 9%, respectively.
On-chain data from IntoTheBlock shows that 12% of Bitcoin addresses are now at a loss—the highest proportion of unrealized losses since October 2024. With many investors having bought Bitcoin near its all-time high of $108,000, the risk of further sell-offs has increased.
Whale activity has also intensified. Over the past week, Bitcoin whales have offloaded more than $1.2 billion. The primary driver behind Bitcoin’s downturn appears to be worsening macroeconomic conditions.
Global markets have been rattled by Donald Trump’s proposed tariffs on Canada and Mexico, which have fueled inflation fears and economic stagnation concerns. Meanwhile, escalating trade tensions between the U.S. and China—particularly over semiconductor restrictions—have dampened risk appetite.
Traditional markets have also experienced declines. The Nasdaq Composite tumbled 2.8%, while the S&P 500 dropped 2.1%. A stronger U.S. Dollar Index signals a shift toward safer assets, further pressuring riskier investments like Bitcoin.
The $88,000 support level remains critical, as a break below this threshold could trigger another wave of liquidations. While high leverage, economic uncertainty, and declining market confidence suggest continued volatility, traders are watching $90,000 as a potential recovery point.
