Bitcoin’s sharp price decline has triggered widespread panic in the crypto market, leading to nearly $1.59 billion in liquidations over the past 24 hours. Around 390,000 traders have suffered losses, with long positions accounting for a staggering 90% of the wipeout. One of the biggest liquidations occurred on HTX (formerly Huobi), where a single trader lost an eye-watering $39.62 million.
Why Is Bitcoin Dropping?
Bitcoin’s price crash to $86,000—its lowest since November—marks its steepest three-day drop since the FTX collapse in 2022. BTC fell 12.6% between Monday and Wednesday, reflecting broader market concerns.
Several factors have contributed to this downturn. ETF outflows have increased as institutional investors appear to be pulling back. Additionally, the Bybit crypto hack has shaken market confidence, while fears surrounding potential tariff hikes from a second Trump administration have added to economic uncertainty.
The Nasdaq’s ongoing struggles have further pressured risk assets like Bitcoin. Noelle Acheson, author of Crypto Is Macro Now, noted that rising inflation expectations and tightening fiat liquidity have reduced the inflow of new capital into the crypto space.
How Low Can Bitcoin Go?
With Bitcoin breaking below its long-standing $90,000 to $110,000 trading range, analysts warn of further downside. Markus Thielen of 10x Research suggests BTC could drop to $72,000–$74,000 before finding meaningful support. Another crucial level to watch is $82,000, a demand zone based on short-term holder data. Historically, Bitcoin rebounds quickly from such levels in bull markets, but in bearish conditions, prices tend to consolidate.
around 20% of EU exports go to the US 🌩️
— Noelle Acheson (@NoelleInMadrid) February 26, 2025
even if the tariffs end up focusing mainly on cars, the US is the largest destination for German car exports 🌩️
around 80% of European car exports to the US come from Germany 🌩️
this is going to hurt an already struggling economy 🫤 https://t.co/0rg5Mfayyo
Renowned analyst Willy Woo believes that Bitcoin’s dip to $82K was not driven by major investor exits but rather its correlation with stock market trends. He identifies $75K as a key target but notes that BTC appears oversold, which could signal a potential rebound.
Chart of the week:
— Willy Woo (@woonomic) February 27, 2025
BTC's correlation to stocks takes out a cluster of liquidations down to 82k in the back drop of very neutral investor activity.
75k presents a juicy target apart from BTC being oversold with strong mean revertive forces now dominant. pic.twitter.com/0ar9MfHT0U
Can Bitcoin Bounce Back?
Despite the current bearish sentiment, many analysts believe a recovery is possible. Bitcoin’s dual nature as both a risk asset and a store of value could attract fresh buyers at lower levels. If BTC stabilizes around $82,000, a strong bounce-back could follow. Additionally, regulatory clarity in the U.S. might act as a catalyst. A recent Senate hearing on digital assets has sparked hopes for clearer guidelines, which could encourage institutional investment and restore confidence.
Also Read: XRP Defies Crypto Crash: Outperforms Bitcoin & Altcoins Amid Market Turmoil
While Bitcoin’s volatility remains a concern, history suggests that major price drops often precede substantial rallies. Long-term investors should stay vigilant, as BTC has repeatedly demonstrated resilience after downturns.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of CoinBrief.io. Before making any investment decisions, you should always conduct your own research. Coin Brief is not responsible for any financial losses.
