Bitcoin's Steep Decline: From Record Highs to Critical Support
Bitcoin has fallen approximately 52% from its October 2025 all-time high, dropping below $63,000 in early February 2026 as multiple headwinds converge.
Price Performance and Current Statistics
Bitcoin's price decreased approximately 52% from its peak of over $126,000, recorded on October 6, 2025 (Coinbase data). The cryptocurrency fell below $60,000 on a Friday in early February, reaching its lowest level since October 2024.
On Monday, Bitcoin fell more than 5% to $64,816.8, and later in the week it traded at $63,410.73, declining nearly 7% for the week. On another day, it reached $63,000, marking its lowest point in over a year. On February 5, Bitcoin reached a low of $63,119.8.
Ether, the second-largest cryptocurrency by market value, was down nearly 6% at $1,865.7. According to CoinGecko data, the global cryptocurrency market has seen a $2 trillion reduction in value since early October.
Contributing Factors
Tariff Policy
U.S. President Donald Trump announced a temporary increase in global tariffs to 15%, up from a previously stated 10% rate. This announcement followed a Supreme Court ruling against his previous tariff strategy. Jeff Mei, COO at BTSE, stated that investors are selling crypto assets due to the sudden increase in tariff rates. The Nasdaq fell more than 2% on Friday, reflecting a reduced risk appetite across markets.
Geopolitical Tensions
Concerns about a U.S. military build-up in the Middle East around Iran and the possibility of armed conflict weighed on investor sentiment, according to Jeff Mei. President Trump indicated a decision on potential strikes against Iran within 10 days. CK Zheng of ZX Squared Capital also referenced "the Iran war started" as a contributing factor.
Institutional Market Movements
Strategy (formerly MicroStrategy), a major buyer of Bitcoin, has turned seller. Spot Bitcoin ETFs experienced persistent outflows as investors moved capital to AI-related stocks. CK Zheng warned that firms holding Bitcoin as a treasury asset might be compelled to sell to meet debt servicing obligations during this bear market.
Macroeconomic Conditions
A hot labor market report and elevated inflation have led markets to price in a Federal Reserve rate hike rather than a cut. Bitwise Chief Investment Officer Matt Hougan identified additional contributing factors including investor rotation into gold and artificial intelligence stocks, ongoing concerns regarding Fed nominee Kevin Warsh, and broader "quantum risk."
Regulatory Scrutiny
The cryptocurrency market faces regulatory scrutiny from U.S. Democrats and oversight groups regarding potential conflicts of interest involving former President Trump and the regulatory environment under the current administration. U.S. Representative Ro Khanna stated his intention to investigate World Liberty Financial, following Wall Street Journal reports alleging that a member of the Emirati royal family provided $500 million in backing to a Trump family cryptocurrency company.
Analyst Perspectives on the Bear Market Cycle
CK Zheng, founder of ZX Squared Capital, stated that Bitcoin is in a deep bear market phase, predicting an additional 30% price drop during 2026. He attributes this outlook to the "four-year cycle" commonly referenced by crypto investors, characterized by periods of price surges, crashes, and subsequent recoveries around quadrennial mining reward halving events. The most recent halving occurred in April 2024. Historically, Bitcoin's price has tended to peak approximately 16–18 months after a halving.
Markus Thielen, head of research at 10x Research, suggested the latest drop was driven by weak liquidity and low conviction, projecting further declines towards $50,000 before a stable bottom forms. Matt Howells-Barby, Vice President at Kraken, identified the $60,000 level as a critical support point, noting that a failure to maintain this level could lead to prices dropping into the $50,000 range.
Analysis of historical data indicates that Bitcoin's price typically bottoms when its 50-week average price falls below its 100-week average price (a "bear cross"). This indicator has historically coincided with the conclusion of major bear markets in 2018 and 2022. Currently, the 50-week average price for Bitcoin remains above the 100-week average, indicating this specific market signal has not yet occurred.
"Bitcoin is in a deep bear market phase." — CK Zheng, ZX Squared Capital
Other Affected Assets
Cryptocurrency ventures associated with the Trump family and traded on the stock market registered value decreases following Bitcoin's decline. Zcash (ZEC) plunged over 40% after a critical vulnerability was discovered with the help of an AI model.
Bitcoin, established after the 2008 financial crisis as an alternative to traditional banking and payment systems, is the leading cryptocurrency by market value.