Bitcoin’s price dropped to a three-month low of $86,008 on Feb. 25, falling below the $90,000 mark for the first time since Jan. 13. Analysts warn that if Bitcoin loses its $85,000 support level, it could continue declining to $81,000. The market downturn comes amid ETF outflows, investor uncertainty, and recent security breaches in the crypto sector.
Bitcoin ETFs in the U.S. recorded over $516 million in net outflows on Feb. 24, marking six consecutive days of selling since Feb. 18. Since the sell-off began, Bitcoin’s price has dropped more than 7%, according to data from Farside Investors. Though MicroStrategy invested another $2 billion in Bitcoin after raising funds through a senior convertible note offering, the market showed no positive reaction.
Ryan Lee, chief analyst at Bitget Research, attributed the sell-off to investors losing confidence. He said Bitcoin is in a consolidation phase and warned that if bearish pressure continues, the price could test support at $86,000 and even drop to $81,000. Hong Yea, co-founder and CEO of crypto exchange GRVT, highlighted the importance of the $85,000 support level, saying a drop below this point could trigger further declines. He pointed to geopolitical concerns, economic uncertainty, and unpredictable policy decisions as factors adding to Bitcoin’s weakness.
Data from CoinGlass shows that if Bitcoin falls below $85,000, it could lead to over $1 billion in leveraged long liquidations across all exchanges. Large liquidations often drive prices lower as traders are forced to close positions.
The recent $1.4 billion hack of crypto exchange Bybit, the largest in the industry’s history, has added to the overall market uncertainty. While the long-term impact is unclear, analysts believe the breach has contributed to the current negative sentiment.
The market remains on edge as Bitcoin struggles to hold key support levels. If the bearish trend continues, the cryptocurrency could see further losses, with $81,000 as the next major support level.