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Over the past 24 hours, positions of traders in the cryptocurrency market have been liquidated for approximately $1 billion. According to CoinGlass, the market has lost nearly half of its capitalization since its peak in October.
The total losses in the cryptocurrency market since the beginning of October have reached $2 trillion. In the last month alone, the market has contracted by an estimated $800 billion, as reported by CoinGecko. For context, the market capitalization was $4.379 trillion in October.
The market decline has been exacerbated by a significant outflow of funds from Bitcoin exchange-traded funds (ETFs). In the last two days, investors have withdrawn nearly $1 billion. According to SoSoValue, on Thursday, February 5, the net outflow from spot Bitcoin ETFs was $434 million, following a withdrawal of $545 million the previous day. As of Friday morning, February 6, the total weekly outflow of funds reached approximately $690 million.
The situation with altcoin ETFs has not been as severe. Ethereum-based funds recorded an outflow of $80.8 million, while XRP and Solana even experienced slight inflows of $4.8 million and $2.8 million, respectively.
On Friday, February 6, the price of Bitcoin briefly fell to $60,000—its lowest level since the fall of 2024. By Friday evening, the leading cryptocurrency was trading at $67,480. Over the course of the day, the asset lost 12%—the largest single-day drop since November 2022. In the past six months, Bitcoin has decreased by 41%, Ethereum by 47%, and XRP by 52%.
A key factor in the cryptocurrency market’s collapse has been the risk management strategies employed by major institutional investors, suggested Bitwise advisor Jeff Park. He believes that the aggressive asset sell-off is driven by hedge funds utilizing multiple investment strategies.
