Bitcoin fell below $80K, triggering mass liquidations
Macroeconomic events drove the sharp sell-off
Recovery outlook remains strong for H2 2026
Bitcoin briefly slipped under the $80,000 mark, triggering a wave of crypto market liquidations totaling $2.55 billion. This event, flagged by crypto trading firm Wintermute, ranks as the 10th largest liquidation event in crypto history. The sharp move came amid broader macroeconomic jitters and risk-off sentiment in traditional markets.
While such a large liquidation event might seem alarming, analysts say it reflects temporary volatility rather than a fundamental breakdown of the crypto market.
What Sparked the Crash?
The plunge was driven by a mix of global economic concerns:
Disappointing earnings from the “Mag7” tech giants rattled investor confidence.
Kevin Warsh’s potential nomination as Fed Chair added uncertainty, as he is known for a more hawkish stance on monetary policy.
Corrections in precious metals like gold and silver hinted at shifting capital flows into safer assets.
These macro triggers combined to create a “risk-off” environment, where investors scaled back from volatile assets, including crypto.
Wintermute said BTC fell below $80,000, triggering $2.55 billion in liquidations, the 10th largest in crypto history. The move was driven by weak Mag7 earnings, Kevin Warsh’s Fed chair nomination, and precious metals corrections. Volatility reflects macro uncertainty and risk-off…
— Wu Blockchain (@WuBlockchain) February 3, 2026
No Structural Weakness: Institutional Confidence Holds
Despite the dramatic price drop, there’s no indication of a structural collapse in the crypto ecosystem. According to Wintermute, institutional infrastructure remains robust, and long-term interest in Bitcoin and other digital assets is still strong.
Many market watchers expect a recovery in the second half of 2026, especially as macro conditions stabilize and institutional investment continues to grow.
This event serves as a reminder that volatility is a feature—not a flaw—of crypto markets, especially when global factors come into play.
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