Crypto Crash: Bitcoin Slumps to $70K, Ethereum Plunges; Altcoins Near Lows

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Why Is the Crypto Market Crashing Today?

The cryptocurrency market is experiencing a significant drop in value. The total value of all cryptocurrencies has fallen to around $2.31 trillion, a level not seen since April 2025. This represents a loss of over $900 billion in just 22 days, highlighting the speed of the recent price declines.

Bitcoin and Ethereum Price Crash Are Dragging the Market Down

The biggest cryptocurrencies are leading the fall:

  • Bitcoin has dropped about $20,000, falling from $90,000 to $70,000, a decline of 23%.
  • Ethereum has fallen nearly $1,000, dropping from $3,050 to $2,070, down 32%.

Prices dropped rapidly, causing many traders to sell their investments. This triggered automatic closure of over $7 billion in trades because of losses. Just in the last day, total losses exceeded $833 million as Bitcoin’s price briefly fell to around $71,000.

Large Bitcoin Sales Increase Pressure

Recent sales by major Bitcoin holders are contributing to the current downward pressure on prices. This week, Bhutan sold $22.4 million worth of Bitcoin after the value of its cryptocurrency investments fell by over 70%. Bhutan’s Bitcoin holdings have decreased from a high of $1.4 billion to approximately $412 million.

When a lot of selling happens during a difficult market, it can make investors worried and cause prices to fall even more.

Altcoins Continue to Struggle

Most cryptocurrencies other than Bitcoin are facing difficulties, with major ones experiencing significant price drops. Bitcoin, Ethereum, Solana, and XRP are among those declining the most, contributing to a generally weak market.

Many smaller cryptocurrencies, besides Bitcoin, are currently trading at their lowest prices in years, which suggests investors are feeling less optimistic about the market.

Avalanche (AVAX) is testing a long-standing price level near $9, its lowest point in years.

Ethereum’s price is still falling, and it’s unclear when it will stop. While there’s a small amount of support around $1,744, the next significant level isn’t until $1,350 – a price it reached during a low point in April 2025. If the price drops further, it could reach that lower level.

Solana’s price has dropped almost 6%, falling below a key support level from April. It’s now likely to find support around $80 to $79, where traders might start buying again.

Sudden and significant price drops have caused many traders to sell their holdings unexpectedly. For example, on the Hyperliquid platform, over $50 million in long positions—bets that prices would go up—were lost, demonstrating the damage that rapid price changes are causing to those hoping for a rebound.

Altcoins are continuing to lose value, indicating that investors are currently avoiding riskier investments and aren’t taking advantage of the price drops to buy.

Global Economic Factors Are Hurting Crypto

Broader economic conditions are also playing a major role in the crash:

  • Investors are putting more money into safer assets like gold and silver, reducing interest in cryptocurrencies.
  • Hopes for U.S. interest rate cuts have faded.

Most market analysts now expect interest rates to remain steady, between 3.50% and 3.75%. There’s only a small chance – about 10% – that the Federal Reserve will lower rates at its meeting on March 18th.

As an analyst, I’ve been watching crypto markets closely, and even the recent resolution of the U.S. government shutdown didn’t give prices the boost many expected. It seems investors are still primarily concerned about persistently high interest rates, and that’s currently outweighing any positive impact from the shutdown ending.

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2026-02-05 12:42