Bitcoin Price Plummets Below $75,000 in Sharpest Drop of 2026

February 07, 2026

Bitcoin suffered its steepest single-day decline of the year on Saturday, plunging more than 11 percent to lows near $74,800 before partial recovery attempts stabilized the price around $76,200 in late trading. The cryptocurrency erased roughly $9,000 from its value in less than 24 hours, dragging the broader digital asset market into a synchronized selloff that wiped out over $200 billion in total market capitalization.

The rapid descent triggered more than $1.8 billion in leveraged position liquidations across major exchanges, with long bets accounting for nearly 93 percent of the forced closures. The scale of the drop ranked among the largest percentage moves for Bitcoin since the post-election volatility spike in late 2025.

Multiple Catalysts Drive the Selloff

Several converging factors fueled the sharp reversal:

• Renewed strength in the U.S. dollar index, which climbed over 1.2 percent against major currencies after Federal Reserve nominee Kevin Warsh reiterated a focus on institutional credibility and a measured approach to monetary policy, reducing expectations for aggressive rate cuts.
• Heavy profit-taking following Bitcoin's strong rally through December and January, when prices briefly approached $105,000 amid earlier safe-haven buying tied to geopolitical tensions.
• Significant outflows from spot Bitcoin exchange-traded funds, with daily redemptions exceeding $900 million according to tracking estimates, signaling institutional de-risking after months of accumulation.
• Broader risk aversion in traditional markets ahead of critical U.S. economic data releases next week, including nonfarm payrolls and inflation expectations, which added pressure on high-beta assets including cryptocurrencies.
• Reports of accelerated selling from long-term holders near previous resistance zones, amplifying downside momentum through clustered stop-loss orders.

Ethereum fell around 13 percent to trade near $2,450, while leading altcoins posted losses ranging from 15 to 25 percent. The total cryptocurrency market capitalization contracted by more than 9 percent during the session.

Technical and On-Chain Signals

On-chain analytics revealed substantial distribution from mid- to long-term holders, though certain large addresses continued accumulating at lower levels. Perpetual futures funding rates plunged deeply negative, confirming overwhelming bearish sentiment among leveraged traders.

Technical indicators reached oversold territory on shorter timeframes, potentially setting the stage for a short-covering bounce if selling exhaustion emerges. However, sustained weakness below $75,000 could expose deeper support zones near $70,000 and $65,000 in more extended correction scenarios.

Market Sentiment and Outlook

The overnight plunge served as a stark reminder of cryptocurrency's high-beta nature and acute sensitivity to dollar movements, macro policy signals, and shifts in global risk appetite. While some participants view the correction as a healthy reset after an overheated advance, others warn that persistent dollar strength and continued institutional outflows could prolong the downturn.

With U.S. employment figures due early next week and uncertainty surrounding the Federal Reserve leadership transition, traders brace for elevated volatility in the sessions ahead. The digital asset space remains in a tense consolidation phase, with attention focused on whether dip buyers emerge aggressively at current levels or if additional capitulation pressure builds.

Bitcoin's sharp retreat contrasts with the continued strength in traditional safe-haven assets such as gold, underscoring the divergent paths risk-on and risk-off investments have taken in early 2026. The coming days will test whether the cryptocurrency can stabilize or faces further downside in a macro environment increasingly dominated by dollar dynamics and policy expectations.