Bitcoin Flash Crashes Overnight, Worst-Case Scenario Could See a Dip to $80,000?
Original Article Title: "Crypto Market Experiences Overnight Flash Crash, Bitcoin Worst-Case Scenario to Drop to $80,000?"
Original Article Author: Lawrence, Mars Finance
At 3:15 a.m. Beijing time on February 19, the price of Bitcoin suddenly flash crashed to $93,300, hitting a new low in nearly two weeks. Although there was a subsequent rebound to $95,400, the significant price volatility caused a major shock to the market.
A 14-hour intense fluctuation plunged the derivatives market into chaos. According to Coinglass data, in the past 24 hours, 142,439 investors globally were liquidated, with a total liquidation amount of $344 million. The market's violent oscillation triggered investor panic and exposed the vulnerability of the cryptocurrency market.
Differential Performance of Core Assets
The crypto index shows a significant stratification of the market in this round of adjustment:
Bitcoin: Despite a 3.2% weekly decline, it remains above the 120-day moving average (around $93,000).
Ethereum: It bottomed out at the key psychological level of $2,600 (a 9.1% drop from the weekly high) and has since rebounded to $2,660, with a 30-day volatility of 47%
Altcoins in Ruins: Solana (SOL) plummeted by 20%, reaching a low of $160, currently priced at $169, erasing all gains since January 13. Dogecoin (DOGE) fell to $0.24, while XRP struggles to hold support around $2.47.
LIBRA Event Impacting Market Sentiment
The ongoing uncertainty in the macroeconomy continues to affect the cryptocurrency market, and the "scam" incident involving the LIBRA meme coin has exacerbated this downtrend sentiment.
QCP Capital's cryptocurrency options trading desk pointed out in their market analysis: "Due to the weak performance of ETH and other altcoins, Bitcoin's dominance has risen to 60%, its highest level in four years. The recent scandal involving Argentine President Javier Milei and LIBRA has also undermined confidence in altcoins and meme coins."
In addition, Bitcoin's upside has been limited since the Federal Reserve paused its hawkish interest rate policy in January. Federal Reserve Governor Patrick Harker has recently maintained a hawkish stance, stating that interest rates will continue to be stable until inflation is under control. This bearish sentiment has kept the Bitcoin price below $100,000 over the past two weeks, but Bitcoin's market dominance (BTC.D) has risen to over 60%, further suppressing the altcoin rebound.
Analyst Jamie Coutts believes that before Bitcoin may rebound, the market may experience another rally.
Bitcoin Cross-Exchange Flow Pulse Turns Bearish
Bitcoin cross-exchange flow pulse chart. Data source: CryptoQuant
According to on-chain analyst Maartunn's analysis, Bitcoin's Inter-Exchange Flow Pulse (IFP) has turned negative, indicating a decrease in potential investors' risk appetite. The IFP metric measures the flow of Bitcoin between the spot and derivatives markets. Historical data shows that when the market is bullish and investor sentiment is high, more Bitcoin moves from spot to derivatives markets. However, when the market weakens, Bitcoin moves out of the futures market and into spot exchanges, showing investors' expectation of a price decline.
On February 16, the IFP metric turned negative for the first time since the third quarter of 2024, indicating a potential shift in market sentiment. Bitcoin researcher Axel Adler Jr also pointed out that Bitcoin futures' long liquidations have reached the highest level in two years. This is similar to the situation in January 2022, when long liquidations marked the beginning of a bear market.
Bitcoin futures long/short liquidation dominance chart. Data source: X.com
Nevertheless, Adler stated that the market has responded to the pressure, indicating that buyers are still active during the adjustment period, engaging in "buying the dip," thereby limiting the extent of Bitcoin's decline.
However, for the bulls, the situation is not completely out of control, as Adler added,
“Currently, the market has responded adequately to this pressure, which actually indicates strong demand during the adjustment period. Buyers are actively 'buying the dip,' limiting the depth of Bitcoin's decline.”
Bitcoin's Worst-Case Scenario Could Drop to Near $80,000
Since February 3, Bitcoin has been consolidating in the range of $95,000 to $99,000. Over the past two weeks, the $95,000 support level has been tested five times. Continued testing of the support level may weaken the effectiveness of this range and increase the risk of breaking below support. Therefore, Bitcoin could close below $95,000 for the first time in the upcoming trades.
If the support level is breached, the price may further decline to a range between $91,130 and $88,909. If the market turns more bearish, the price could retrace to a range between $81,699 and $85,160, which was the price range during Bitcoin's early "Trump Pump" rebound period.
The CME's daily gap still remains between $77,000 and $80,000, which could represent Bitcoin's worst-case scenario, implying a further potential 15% drop in price.
You may also like
Latest research from 13 top universities including Cornell University: The current state, challenges, and misconceptions of the fusion of Crypto and AI
Deconstructing Anthropic: The Best AI Company, Possibly Also a Type of Organizational Invention
Apollo and Blackstone Reportedly Back $35 Billion Anthropic Chip Financing as Deal Details Remain Unclear
On June 9, according to currently available news alerts, Apollo and Blackstone Group participated in a $35 billion financing for an Anthropic “chip project.” Based on the original wording of the report, the funding has already been raised, but public information remains limited. The financing structure, use of proceeds, project entity, and whether Apollo and Blackstone participated through equity, debt, or project financing have not yet been disclosed.
Humanity Protocol Security Incident Escalates: More Than $31 Million Stolen From Related Addresses as Attacker Continues Selling H for ETH
On June 9, according to monitoring by Onchain Lens, more than $31 million has been stolen from addresses linked to Humanity Protocol, and the attack is still ongoing, with the hacker continuously swapping H tokens for ETH. Project founder Terence Kwok later confirmed the security incident on X, saying the issue involved a private key leak.
Bloomberg: As Bitcoin Weakens, Stablecoins and RWA Continue to Drive Expansion in Crypto Businesses
In June, Bloomberg reported that despite Bitcoin falling below $60,000 last week, wiping out about $235 billion in market value within seven days, and dropping close to 50% from last year’s peak, some core businesses in the crypto industry are still expanding, mainly in stablecoins, real-world asset tokenization (RWA), payments, and infrastructure. The report also noted that overall altcoin activity has contracted significantly: altcoin market capitalization has fallen from a peak of about $431 billion in November 2021 to around $170 billion, and among the tens of millions of tokens issued in recent years, fewer than 1,700 still maintain meaningful trading activity.
Galaxy Deep Research Report: How Hyperliquid's HIP-4 Upgrade Changes the Landscape of Prediction Markets?
Binance Research: RWA Market Expected to Expand Nearly 6x from Early 2025, with Public Equities and Onchain Payments Heating Up Together
In June, Binance Research said in its monthly market report that the real-world asset (RWA) market is expected to grow by about 589% from the beginning of 2025. Bond- and money market fund-related RWA expanded by about $6.5 billion, up 83% year over year, while publicly traded equity RWAs grew by about 422%. The report also noted that monthly crypto debit card transaction volume exceeded $747 million in May, up 48.6% year to date.
Japan to Assess a Framework for Yen Stablecoins and Crypto ETFs as Asia’s Compliant Payments Narrative Heats Up
Recently, according to the original report, Japan is considering the launch of yen stablecoins and cryptocurrency ETFs. Public information remains limited at this stage, and there is still no complete policy text, regulatory draft, or clear implementation timeline, so this is better characterized as a “policy discussion” rather than formal implementation. The original wording also noted that advancing stablecoin regulation in Asia is driving XRP usage and supporting growth in the XRPL ecosystem. However, based on currently available public information, there is not enough evidence to directly establish a clear causal relationship between this round of discussion in Japan and XRP or XRPL.
ZachXBT: Humanity private key leak and abnormal surge in H token should be viewed separately
On June 9, according to related disclosures, on-chain investigator ZachXBT posted an update on Humanity’s roughly $31 million security incident, saying that after further analyzing fund flows, he currently tends to believe the project team was not involved in an “inside job” or a self-staged attack. According to him, the official explanation about the private key leak was broadly accurate, but before the token unlock, the price of H had been artificially pushed higher, and the hacker later took advantage of that market environment; therefore, the private key leak and the earlier abnormal price pumping should be regarded as two separate and independent events. This reframing has shifted the market’s understanding of the nature of the incident. Earlier discussion around Humanity had focused on whether the team directly participated in the attack or used the security incident to cover up internal operations. ZachXBT’s latest remarks shift the focus from “whether it was self-theft” to “whether there were pre-unlock market structure issues.” He also questioned whether the team may have.
Morning Report | OpenAI has submitted an S-1 registration statement draft to the U.S. SEC; Morpho completes $175 million financing
Morning Report | BitMine increased its holdings by 126,971 ETH last week; trader Eugene announced his exit from the crypto market
Wang Chuan: How can one not feel anxious after the neighbor Old Wang made thirty times profit by investing in storage stocks? (Seven) - A quarter-century cycle
Cryptocurrency CEXs are flocking to sell US stocks, and traditional brokerages are facing an "uninvited guest."
$75 billion in foreign capital has fled, and South Korean retail investors have absorbed it all using leverage
Japan’s Three Megabanks Plan Joint Stablecoin Issuance in Fiscal 2026
MUFG, SMBC, and Mizuho reportedly plan to jointly issue fiat-pegged stablecoins in fiscal 2026, signaling Japan’s growing push into bank-led digital payment infrastructure.
Humanity Discloses H Token Dual-Chain Attack Details, With Losses on Ethereum and BSC Exceeding $36 Million
Humanity said the H token attack across Ethereum and BSC caused more than $36 million in losses after leaked ProxyAdmin keys enabled malicious contract upgrades and token minting.
White House Discusses CLARITY Act With Law Enforcement Ahead of Senate Vote
The White House discussed the CLARITY Act with law enforcement ahead of a Senate vote, focusing on illicit finance risks and developer protections.
Bitcoin Trading Guide 2026: Strategies for Experienced Traders
Latest research from 13 top universities including Cornell University: The current state, challenges, and misconceptions of the fusion of Crypto and AI
Deconstructing Anthropic: The Best AI Company, Possibly Also a Type of Organizational Invention
Apollo and Blackstone Reportedly Back $35 Billion Anthropic Chip Financing as Deal Details Remain Unclear
On June 9, according to currently available news alerts, Apollo and Blackstone Group participated in a $35 billion financing for an Anthropic “chip project.” Based on the original wording of the report, the funding has already been raised, but public information remains limited. The financing structure, use of proceeds, project entity, and whether Apollo and Blackstone participated through equity, debt, or project financing have not yet been disclosed.
Humanity Protocol Security Incident Escalates: More Than $31 Million Stolen From Related Addresses as Attacker Continues Selling H for ETH
On June 9, according to monitoring by Onchain Lens, more than $31 million has been stolen from addresses linked to Humanity Protocol, and the attack is still ongoing, with the hacker continuously swapping H tokens for ETH. Project founder Terence Kwok later confirmed the security incident on X, saying the issue involved a private key leak.
Bloomberg: As Bitcoin Weakens, Stablecoins and RWA Continue to Drive Expansion in Crypto Businesses
In June, Bloomberg reported that despite Bitcoin falling below $60,000 last week, wiping out about $235 billion in market value within seven days, and dropping close to 50% from last year’s peak, some core businesses in the crypto industry are still expanding, mainly in stablecoins, real-world asset tokenization (RWA), payments, and infrastructure. The report also noted that overall altcoin activity has contracted significantly: altcoin market capitalization has fallen from a peak of about $431 billion in November 2021 to around $170 billion, and among the tens of millions of tokens issued in recent years, fewer than 1,700 still maintain meaningful trading activity.
Galaxy Deep Research Report: How Hyperliquid's HIP-4 Upgrade Changes the Landscape of Prediction Markets?
