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Today was one of the bad ones – the days that your friends or family text you to see how everything is going.
Double-digit percentage drawdowns for ETH and BTC. CoinGlass reporting over $2 billion in liquidations over the past 24 hours. Strategy stock down 17% on the day with crypto stocks down across the board. Meanwhile, one-third of the top-100 coins lost at least a quarter of their value this week.
Today's selling was indiscriminate and forceful, pulling the crypto industry firmly into bear market territory. The urge might strike to buy the dip, but with history as a guide, it might be best to wait for the dust to settle before you go shopping.
Tough Conditions, Risk Ahead
Anyone who thought February 2026 would bring smooth sailing for cryptocurrency markets has been in for a rude awakening this week.
While the daily drawdowns experienced by many premier crypto assets had been limited to single digits earlier this week, Thursday produced a market slide much more devastating in nature, wreaking double-digit drawdowns and eviscerating key support levels of anything and everything crypto-related.
Bitcoin took back a month's worth of gains overnight as it plunged below $63K for the first time since October 2024, 
Ethereum reset almost the entirety of its 2025 bull market with a tumble below $2K, and 
Solana snapped to $80 for the first time since 2023.
The selloff spilled into digital asset treasuries, whose stocks followed spot prices lower. BTC’s Strategy slid 17%, ETH’s BitMine fell 14%, and SOL’s FWDI dropped 10%. Crypto-focused exchanges were not spared. HOOD dropped 10% and COIN collapsed 13%. Issuing dollars offered no insulation; even stablecoin equities succumbed. CRCL is now circling the drain after falling 9% to fresh all-time lows.
It's safe to say things aren't looking great out there.
The key question you're probably wondering is: why now?
My colleague David's article on Monday offered a few potential answers – arguing the changing of the guard at the Federal Reserve had triggered a rush to risk-off assets like precious metals which promptly roller-coastered themselves.
David Christopher Feb 2, 2026 • 5 min read
An exact catalyst for the indiscriminate selling feels difficult to determine, and perhaps only one fact matters: crypto is indeed now firmly in a bear market.
10 REASONS WHY THIS IS THE WORST CRYPTO WINTER EVER
— Joe Weisenthal (@TheStalwart) February 5, 2026
In today's newsletter, I wrote about how there are just numerous dynamics all happening at once -- from Epstein to quantum to AI to the death of crypto twitter -- clobbering the coins pic.twitter.com/3jQQR7jk6O
Most cryptocurrencies don't boast traditional value anchors and are often priced on the margins by speculators. These qualities create an inherent volatility that can make crypto markets a useful leading indicator for financial conditions up ahead.
The stock market's S&P 500 closed just under 3% off the fresh all-time high it set last Wednesday, yet there are some warning signs causing tech investors pause, with software stocks getting put out to pasture, major commodity markets experiencing statistically improbable moves in sequence, and general anxiety over the longevity of this AI exuberance.
Whether this crypto bear market proves to be an early warning for macro deterioration or simply another false alarm, today's move certainly comes at a tough moment for market sentiment and has left plenty on Crypto Twitter sounding the alarm.
While your favorite Twitter accounts may be panic selling in the background while publicly urging you to buy the dip, most storied investors caution against trying to catch falling knives. Taking a minute to pause and build your own takes on what you believe lies ahead, then positioning yourself in a targeted manner rather than rushing in or out of positions has generally been a wise route, but this is a journey every crypto investor needs to take for themselves.
We've been here before, and we've come out of it. That doesn't make these days any easier, though.
