Bitcoin (BTC) fell to $60,062 last Thursday, February 6, marking a 52% decline from October 2025's $126,000 peak in the deepest drawdown of the current cycle.
On-chain data shows realized losses averaging $1.26 billion per day over the past week, levels not seen since the FTX collapse in November 2022.
The sell-off erased roughly $570 billion from cryptocurrency markets in 2026, with Bitcoin breaking through multiple structural support levels including the short-term holder cost basis and yearly open.
Unlike previous liquidation-driven crashes, persistent spot selling characterized the latest decline.
Capitulation Signals Flash Red
Glassnode recorded the second-largest investor capitulation spike in two years, with single-day realized losses reaching $889 million on Feb. 6.
The metric measures coins sold below acquisition price, indicating widespread forced selling as investors exit underwater positions.
Open interest dropped nearly 50% from peak levels as leverage was flushed from the system. Over $1 billion in positions were liquidated in 24 hours affecting 216,590 traders, with long positions bearing the brunt of forced closures.
The Fear and Greed Index hit 12 points, indicating "extreme fear" among traders. Small retail holders with less than 10 Bitcoin sold persistently for over a month, while mega-whales holding 1,000-plus coins quietly accumulated at lower prices.
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Exhaustion Emerges After Panic Selling
On-chain analysts identified potential stabilization signs despite the severe drawdown. The magnitude of realized losses historically correlates with late-stage corrective phases rather than trend initiation, suggesting selling pressure may be nearing exhaustion.
Significant supply accumulation appeared between $70,000-$80,000, with a dense cluster between $66,900-$70,600 where new buyers positioned themselves. These cost-basis concentrations often act as support zones where demand absorbs selling pressure.
Bitcoin rebounded to around $69,600 Friday after the Thursday crash, though the $60,000-$74,000 range now defines the key battleground.
The cryptocurrency must consolidate losses and reset positioning before clearer directional signals emerge on whether this range becomes a base for recovery or precedes further downside.
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