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Bitcoin’s price fell sharply to just above $86,000, triggering over $1.06 billion in liquidations across the crypto market. Long traders took the biggest hit, with losses reaching $873 million, according to Coinglass data from February 26. Open interest dropped 5%, reflecting a wave of deleveraging, while exchange inflows climbed 14.2%, suggesting increased panic selling. Negative funding rates indicate a shift in sentiment, as traders adjust their expectations.
A major factor behind the sell-off was heavy withdrawals from U.S. spot Bitcoin ETFs. Over the past five days, outflows reached $1.1 billion, with $516 million withdrawn on February 24 alone. This pressure on the ETF market has added to concerns about Bitcoin’s short-term stability.
Crypto-related stocks also felt the impact. Coinbase (COIN) fell 6.4%, while Robinhood (HOOD) lost 8%. Bitcoin miners faced steeper declines, with Bitdeer (BTDR) dropping 29% and Marathon Digital (MARA) falling 9%.
On-chain data from IntoTheBlock shows that 12% of all Bitcoin addresses are now holding at a loss, the highest level since October 2024. Many investors who bought near Bitcoin’s all-time high of $108,000 are now underwater, raising the risk of further selling.
Large Bitcoin holders have been moving funds as well. Whales offloaded over $1.2 billion in Bitcoin over the past week, adding to the selling pressure. Macroeconomic conditions have played a role in the downturn, with uncertainty surrounding global markets.
Donald Trump’s proposed tariffs on Canada and Mexico have fueled concerns about inflation and economic stagnation. Meanwhile, rising tensions between the United States and China, particularly over semiconductor trade restrictions, have weakened investor confidence.
Stock markets have also struggled. The Nasdaq Composite fell 2.8%, and the S&P 500 lost 2.1%. A stronger U.S. Dollar Index signals a shift toward safer assets, which often puts pressure on Bitcoin and other riskier investments.
Bitcoin’s $88,000 support level remains a key area to watch. If the price falls below it, more liquidations could follow. At time of writing Bitcoin is trading at $89,195 according to CoinMarketCap data.