Bitcoin's sharp price decline has triggered significant effects across the crypto market.
Liquidations Due to Bitcoin Drop
Bitcoin's price drop to $86,099 resulted in the liquidation of 230,000 traders with a total of $1.06 billion losses. Long positions accounted for $873 million of this total. Investors are reducing their positions, reflected in a 5% drop in open interest and a 14.2% increase in exchange inflows, demonstrating rising market selling.
ETF Outflows and Stock Market Impact
The depreciation of Bitcoin affected related financial instruments and stocks. On February 24 alone, investors withdrew $516 million from U.S. spot Bitcoin ETFs, part of a total five-day withdrawal of $1.1 billion. Coinbase shares fell by 6.4%, while Robinhood and Bitdeer decreased by 8% and 29% respectively; Marathon Digital dropped by 9%. According to IntoTheBlock, 12% of Bitcoin addresses are in bearish positions.
Whale Activity and Macroeconomic Factors
Bitcoin whales have sold off over $1.2 billion during the past week. The sell-offs are driven by macroeconomic factors such as President Donald Trump's proposed tariffs. The ongoing political tensions between the U.S. and China are also contributing to traditional market declines, with Nasdaq and S&P 500 indices dropping. The rise in the U.S. Dollar adds pressure to Bitcoin and other risky assets.
Bitcoin's price holds at the critical $88,000 mark; a drop below this point could lead to further liquidations. Market volatility is expected to continue amid economic uncertainty.
