On February 5, 2026, the cryptocurrency market experienced a "Black Thursday." Bitcoin (BTC) broke through the psychological barriers of $70,000 and $68,000 in just a few hours. Since reaching an all-time high of $126,000 last October, BTC has retreated by as much as 45% in just four months.
From the fervent anticipation of a " Trump bull market" to the current liquidity crunch, the market narrative is undergoing a dramatic shift.
Furthermore, with the Clarity Act stalled in the legislative process, the market's previous expectations for policy benefits have cooled significantly. Meanwhile, a Pew Research Center poll released on January 29 showed Trump's approval rating had fallen to a yearly low of 38%, further diminishing the market optimism previously fueled by the "Trump bonus . "
Currently, there is a consensus in the prediction market that BTC will reach $65,000, and even 60% of investors are betting that the price will fall back to below $55,000 by the end of the year.
This sharp drop caught many newcomers who entered the market at last year's highs off guard, while industry veterans also offered their perspectives from different angles.
Jan3 CEO and staunch Bitcoin supporter Samson Mow stated: "This pullback feels terrible, not because of its magnitude, but because it's unfair. Everything else is going up, and we're trading sideways; AI bubble fears are rising, and we're falling; the metals market is crashing, and we're falling too."
This divergence between crypto assets and those that fall but don't rise reflects the awkward situation they face in the current reallocation of macro liquidity.
What is the price of "begging" from Wall Street?
For a long time, the crypto market has longed to be "crowned" by traditional finance (TradFi), but this crash has made some analysts reflect on the cost of such "co-optation".
Market analyst Jim Bianco expressed strong aversion to the "traditional finance/baby boomer entry" narrative that has prevailed over the past year: "Cryptocurrencies are built on the principle of permissionlessness; they are designed to disrupt the traditional financial system. I believe in this mission. In many ways, the traditional financial system does need to be disrupted. Seeking endorsement from Larry Fink, Powell, or Trump is the antithesis of the crypto spirit. The next surge will not come from more suited elites 'endorsing' Bitcoin."
Bianco believes that if the crypto industry cannot return to its original intention of "building an alternative financial system" and instead simply waits for the patronage of giants like BlackRock, then the "Crypto Winter" will continue.
The Big Short's Warning: The Death Spiral on Corporate Balance Sheets
Michael Burry, the inspiration for the novel "The Big Short," recently warned that Bitcoin could trigger a "self-reinforcing death spiral." His core concern is that Bitcoin's volatility is spreading to risky assets through corporate balance sheets.
Currently, nearly 200 publicly traded companies (represented by MicroStrategy) hold significant positions in Bitcoin. These companies have essentially evolved into "leveraged Bitcoin ETFs." When BTC falls by 10%, the stock prices of these companies could potentially fall by 25% or even more.
Burry points out that as prices fall further, company boards and risk managers will be forced to reduce their holdings to protect capital and meet risk management policies. This "forced sell-off," based on survival rather than strategy, will deal a devastating secondary blow to Bitcoin's price. Burry believes that Bitcoin has failed as a digital safe-haven asset or a substitute for gold, and that the recent ETF-driven rally is speculative rather than evidence of lasting, real-world adoption.
Cyclical Recurrence: Opportunity or Abyss?
Despite the widespread devastation, some OGs remained calm.
Former Coinbase CTO Balaji Srinivasan maintained his consistently "highly bullish" stance: "I have never been so bullish on Bitcoin because the rules-based order is collapsing, and the code-based order is rising. Short-term price fluctuations are meaningless."
summary
History doesn't simply repeat itself, but it often rhymes. Look at the past:
In 2014, Mt. Gox was hacked, and the market collapsed.
In 2018, the ICO bubble burst, and Bitcoin fell by three-quarters.
From 2021 to 2022, from heavy regulatory pressure to the collapse of FTX, confidence was repeatedly shaken.
Every time, everyone thinks "this time is different," but looking back, after each deep drop, Bitcoin has indeed climbed back up and reached new highs. In terms of time, it usually takes a year to a year and a half, but there are also times that take longer—the one in 2013 took almost three years.
So this drop to 60,000 is painful, but it's not a new development.
What's most important right now?
First, save your ammunition. Don't use up all your resources in a panic. The market never lacks opportunities, only patience.
Second, stay at the table. Many people fail not because they misjudge the direction, but because they are forced to leave at the bottom of the cycle.
Balaji Srinivasan put it simply: "I've never been more optimistic about encryption than I am now... because a code-based order is on the rise."
In the short term, it's all about sentiment; in the long term, it's about the rules. As long as BTC's hard cap of 21 million coins holds, the game is far from over. If it drops, just hold on; survival is more important than anything else.
Author: Little Bear Biscuit | Bitpush
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