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Bitcoin spectacularly failed to maintain the post-election momentum in 2025, but it didn’t stop there. The token fell well below $74,000 on February 3, 2026, erasing nearly all gains since President Donald Trump’s famous November 2024 victory night. Trading around $73,000, BTC last sat at these levels in early November before the surge that carried it to an all-time high of $126,080 on October 6, 2025.
JUST IN: Bitcoin falls under $73,000
$285,000,000 liquidated from the crypto market in the past 60 minutes. pic.twitter.com/bSyfCpyOHF
— Watcher.Guru (@WatcherGuru) February 3, 2026
Glassnode account manager Sean Rose highlighted the pain, stating that 44% of the bitcoin supply is “now underwater” after a roughly 30% drop from the recent $108,000 high. Supply in profit fell from 78% to 56%, a signal that weak hands may continue selling. “Top buyers near the ATH are now holding at a loss,” Rose said. “Concentrated supply with cost basis near recent highs is being tested. These investors’ conviction and patience will be tested in the coming weeks and months.”
Derivatives markets also amplified the downside. Over $122 million in long positions liquidated in the last hours alone, contributing to $663 million total liquidations in the past 24 hours.
Bitcoin’s Relative Strength Index hit oversold territory near 30, the lowest since the 2022 bear bottom, when BTC fell another ~20% to around $60,000. A similar move today would imply a drop toward that level.
The decline appears to be caused by a number of factors. There’s the looming uncertainty around macros, with many expecting a potential U.S. government shutdown, while equities broadly tanked. Nasdaq Composite down 2.2% Tuesday. ETH fell over 2% to below $2,200, SOL over 6% to below $100, and XRP 0.32% to ~$1.59. Canton led top-25 losses, down over 7% to ~$0.17.
Crypto stocks followed suit. Coinbase dropped over 5%, Strategy over 7%. TeraWulf bucked the trend with its AI infrastructure acquisition news, growing by 10.12%.
Bitcoin ETFs saw a reprieve Monday with $561.9 million net inflows, which reversed two weeks of selling. As analysts from Bitfinex noted, “Despite heavy redemptions from Bitcoin and Ethereum ETFs, totalling roughly $1.5 billion and $327 million respectively from January 26–30, 2026, some altcoin-focused products continued to attract inflows. Solana and XRP-linked ETPs saw net inflows, pointing to a tactical rotation from large-cap crypto assets into select smaller-cap exposures.”
🇺🇸 ETF Update: On Feb. 3
Spot ETFs for #ETH, #SOL, and #XRP recorded net inflows, while BTC spot ETFs posted net outflows.
•BTC: –$272.02M
•ETH: +$14.06M
•SOL: +$1.24M
•XRP: +$19.46M— Pushpendra Singh Digital (@PushpendraTech) February 4, 2026
This is not a clean pullback, it’s a leverage flush meeting macro nerves. The RSI oversold signal throws back to 2022, but context differs this time. For example, there is higher institutional exposure and ETF flows provide a potential floor, while altcoin rotation hints at selective strength.
Meanwhile, Michael Burry has issued a stark warning that Bitcoin’s ongoing decline is set to erase substantial value from corporate balance sheets holding large BTC positions, arguing that the cryptocurrency has failed to serve as a reliable safe haven akin to gold and instead behaves more like a volatile, high-beta stock closely correlated with the S&P 500.
BREAKING: Michael Burry warns Bitcoin’s decline will wipe out significant value for companies holding large amounts on their balance sheet.
He says BTC has failed as a safe haven like gold and behaves more like a volatile stock tied to the S&P 500. Aggressive holders face… pic.twitter.com/Ff9G3b7cgo
— SwanDesk (@SwanDesk) February 3, 2026
The ‘Big Short’ investor, famous for predicting the 2008 financial crisis, cautioned that aggressive or over-leveraged holders now face serious bankruptcy risk as prices continue to fall, which could result in forced sales, further downward pressure, and broader market turmoil across the crypto and traditional financial sectors.
For users, it’s a reminder that post-halving cycles are still volatile, gains can vanish quickly when leverage unwinds, and headlines change positions. The real question is whether this clears weak hands and sets up a base, or signals bigger macro risk. If ETF inflows resume and alt rotations hold, BTC could stabilize, if shutdown fears or risk-off persist, $60,000 becomes a realistic mark. Watch daily liquidations and ETF flows closely; the next few days will show if this is a flush or a fracture.
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