$2 Billion Liquidated, $70,000 Erased — Bitcoin’s Brutal Reality Check Has Arrived

 $2 Billion Liquidated, $70,000 Erased — Bitcoin’s Brutal Reality Check Has Arrived

$2 Billion Liquidated, $70,000 Erased — Bitcoin’s Brutal Reality Check Has Arrived

The cryptocurrency market is experiencing one of its most intense downturns in recent memory, as highlighted in a recent CNBC report from February 5, 2026. Titled with "Bitcoin price today: $70,000 in focus", the article captures a dramatic shift where Bitcoin (BTC), once celebrated as "digital gold" and a hedge against traditional financial uncertainties, has plunged sharply, breaking through critical price levels and sparking widespread doubt among investors.

Bitcoin's price action has been brutal. The flagship cryptocurrency briefly dipped below '$61,000' during overnight trading on February 5, hitting a low of around '$60,062', before partially recovering. By late that evening, it was trading at approximately '$62,448', reflecting a '15% drop' in a single day. This came amid a broader weekly decline of nearly '30%', and a staggering '40%' loss over the past year. From its all-time high of just over **$126,000** in early October 2025, Bitcoin has shed more than **50%** of its value in just a few months—a drawdown steeper than some earlier bear phases, including parts of 2022.

A major focal point in the coverage is the '$70,000' level, long viewed as a key psychological and technical threshold. Analysts noted that Bitcoin broke below this mark earlier on February 5, accelerating the sell-off. James Butterfill, head of research at Coinshares, described '$70,000' as a "key psychological level," warning that failure to hold it makes a slide into the '$60,000–$65,000' range "quite likely." CryptoQuant echoed this, pointing to Bitcoin's breach of its 365-day moving average (the first since March 2022) and a subsequent '23%' decline in just 83 days—worse than the early 2022 bear market leg. The potential downside, they suggested, targets the '$70K–$60K' zone if momentum continues.

Several interconnected factors are fueling this meltdown. Institutional demand, once a strong tailwind (with U.S. spot Bitcoin ETFs net buying heavily a year ago), has "reversed materially," turning to net selling in 2026 according to CryptoQuant data. Forced liquidations have been massive—over **$2 billion** in crypto positions wiped out this week alone, per Coinglass—adding fuel to the fire through cascading margin calls.

Broader market dynamics are also at play. Bitcoin is no longer decoupling from risk assets; instead, it's moving in lockstep with tech stocks during sell-offs, correlating with declines in indices like the State Street Technology Select Sector SPDR ETF. Geopolitical tensions, macroeconomic uncertainties, and doubts about Bitcoin's core narratives (as an inflation hedge, fiat alternative, or safe-haven asset) have eroded confidence. Unlike gold, which has gained **61%** over the past year, Bitcoin has fallen nearly **40%**, underperforming precious metals dramatically. Adoption as a payment method remains minimal, further weakening its "story."

The pain extends beyond Bitcoin. Ethereum (ETH) has pulled back **33%** this week, Solana (SOL) hit a near two-year low around '$88', and other altcoins like XRP have suffered even steeper drops. The overall crypto market is deepening into the red, reviving talk of a prolonged "crypto winter."

Expert commentary underscores the shift in sentiment. Deutsche Bank's Marion Laboure observed that "traditional investors are losing interest, and overall pessimism about crypto is growing." Maja Vujinovic, CEO of digital assets at FG Nexus, noted that the expected "straight-line bull run" never materialized—Bitcoin is now trading purely on liquidity flows and capital movements, not hype.

As of early February 6, 2026, Bitcoin's price has shown some intraday volatility, fluctuating around the mid-"$60,000s" (with snapshots ranging from lows near "$60,000" to recoveries toward "$65,000"), but the downward pressure remains heavy. This sell-off has erased Trump-era gains for many holders and raised questions about Bitcoin's role in portfolios moving forward.

In the bigger picture, this moment serves as a stark reminder of crypto's volatility. What was once a euphoric ascent has given way to a sobering reality check: assets tied to sentiment, liquidity, and macro correlations can reverse quickly. Whether this is a deep correction before another leg up or the start of a longer bear phase remains uncertain—but for now, the market is firmly in risk-off mode, with "$70,000" no longer a floor but a distant memory from recent highs. Investors are left weighing whether to hold through the storm or reassess their exposure in what has become a challenging environment for digital assets.