The post Why Bitcoin is Crashing? appeared first on Coinpedia Fintech News Bitcoin price today dropped sharply, falling to the $74,000 level and triggering anotherThe post Why Bitcoin is Crashing? appeared first on Coinpedia Fintech News Bitcoin price today dropped sharply, falling to the $74,000 level and triggering another

Why Bitcoin is Crashing?

5 min read
Why Bitcoin is Crashing?

The post Why Bitcoin is Crashing? appeared first on Coinpedia Fintech News

Bitcoin price today dropped sharply, falling to the $74,000 level and triggering another wave of selling across the crypto market. Ethereum slipped nearly 10% to around $2,100, while most major altcoins declined between 5% and 10% today.

The sudden move has raised fresh concerns about whether Bitcoin is entering a deeper correction phase after weeks of volatility.

Possible Reasons Behind the Bitcoin Crash Today

The latest Bitcoin crash is not linked to a single event. Instead, analysts point to multiple factors hitting the market at the same time, creating strong downward pressure.

Heavy Liquidations Accelerate Bitcoin Decline

One of the main reasons behind the drop is massive liquidations in the futures market. Market data shows that over $500 million worth of Bitcoin positions were liquidated in recent sessions.

Many traders were using high leverage. When Bitcoin slipped even slightly, automatic liquidations kicked in, forcing positions to close. This led to a chain reaction of selling, pushing prices lower within minutes.

After the U.S. market opened, Bitcoin dumped another $1,700, wiping out more than $55 million in long positions in just two hours. The overall crypto market lost nearly $50 billion during the same move.

US Stock Market Weakness Hits Crypto Hard

The crypto sell-off mirrored weakness in traditional markets. The S&P 500 fell nearly 1.3%, as investors moved away from risk assets.

Historically, when global markets turn cautious, cryptocurrencies tend to react faster and more sharply. The same pattern played out this time, with Bitcoin and altcoins facing intense selling pressure.

Spot Bitcoin ETF Outflows Add Pressure

Another key factor weighing on prices is strong outflows from spot Bitcoin ETFs.

As per CoinGlass data, on February 3, spot BTC ETFs recorded $272 million in net outflows. BlackRock’s IBIT stood out as the only major buyer with $60 million in inflows, while other funds continued to see selling.

When ETF flows turn negative like this, it often signals reduced confidence among institutional investors, even if long-term interest remains intact.

Epstein Files Add to Market Uncertainty

Beyond macro pressure and liquidations, renewed discussion around the Epstein files has added another layer of uncertainty to the crypto market. Reports highlighting Jeffrey Epstein’s past connections to early Bitcoin research, funding linked to MIT’s Digital Currency Initiative, and ties to prominent crypto figures have resurfaced online. 

While there is no direct evidence linking these revelations to current price action, the narratives have fueled speculation on social media and increased short-term volatility. During already weak market conditions, such controversies often amplify fear and contribute to risk-off behavior among traders.

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Geopolitical Tensions Increase Market Uncertainty

Rising global tensions have also played a role. Ongoing disputes involving the United States, Iran, and Venezuela, along with tariff-related concerns, have increased uncertainty across financial markets.

During such periods, large funds and ETF managers usually cut exposure to risky assets. This capital outflow has added further pressure to Bitcoin and the broader crypto market.

Profit-Taking After Bitcoin’s Massive Rally

Galaxy Digital CEO Mike Novogratz believes the recent decline is mainly driven by profit-taking, not panic.

According to him, many investors who bought Bitcoin at much lower levels started selling after prices crossed $100,000, locking in gains after a long rally. He described the move as a “seller’s wave”, rather than fear-driven selling.

Novogratz also dismissed concerns around emerging threats like quantum computing, saying price moves are still driven by basic supply and demand.

Bitcoin Price Analysis: Key Support and Resistance Levels

The market is sitting at a critical turning point. If Bitcoin slips below the $74,500 support, the next downside target is seen around $69,800–$68,000, a zone that previously acted as strong resistance. 

A deeper breakdown from there could drag prices toward the $53,000–$54,000 range, implying a correction of nearly 30% from current levels. 

On the upside, analysts believe a quick recovery is unlikely, as Bitcoin would need to reclaim the $90,000–$95,000 resistance zone and establish a clear higher-high structure before any sustained rebound can take shape.

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FAQs

Why is Bitcoin price down today?

Bitcoin is down today due to leveraged liquidations, weak U.S. markets, ETF outflows, profit-taking after the rally, and rising global uncertainty.

How do U.S. stock market declines impact Bitcoin prices?

When stocks fall, investors reduce risk exposure. Bitcoin typically reacts faster, leading to sharper declines during market-wide sell-offs.

Is the current Bitcoin drop a healthy correction?

Yes. Many analysts view this move as a normal correction after a strong rally, helping reset leverage and excess speculation.

Does profit-taking mean Bitcoin’s bull market is over?

No. Profit-taking is common after major rallies and does not signal the end of a long-term bullish trend.

What could drive Bitcoin prices higher again?

Stabilizing markets, renewed ETF inflows, reduced leverage, and improving macro sentiment could support a recovery.

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