Bitcoin's 1557-Day Peak Broken: A Flow-Driven Bear Market Regime

Bitcoin has broken below a key psychological and technical level, triggering a massive liquidation event and signaling a shift from a bull market to a bear-market regime.

The breakdown began on February 5 when the price fell below $69,000, marking the first drop under the previous bull market peak in 1,557 days. This clean break below a multi-year high watermark has shattered the recent uptrend and opened the door for a faster slide.

The immediate flow of capital out of the market was severe. Over the past 24 hours, more than $1 billion in crypto positions were liquidated, including about $980 million in bullish leveraged bets. This sharp single-day slide of roughly 11%–13% erased recent upside and triggered about $272 million in net outflows from U.S. spot Bitcoin ETFs. The liquidation event confirms a rapid deleveraging cycle, with traders forced to close long positions as the price moved through key mechanical levels.

The New Regime: ETF Flows and Risk-On Correlation

Bitcoin ETF flows have entered a bear-market regime, with the latest session showing broad outflows from major funds. The latest data reveals about $272 million in net outflows from U.S. spot Bitcoin ETFs, with products like Fidelity's FBTC and Grayscale's GBTC each seeing over $50 million pulled. This shift from accumulation to risk-management selling is structural, not a temporary dip. The persistence of these outflows, now the longest since the ETFs launched, reflects a reassessment of Bitcoin's medium-term outlook by longer-horizon investors.

This institutional retreat is mirrored by Bitcoin's market structure, which now ties it closely to broader risk assets. The price drawdown is deeper than losses seen in other major assets, indicating declining demand. While gold and U.S. tech stocks are also under pressure, Bitcoin's decline is more severe and persistent. The asset is now trading as a risk-on asset, not a defensive one, meaning its price moves are increasingly correlated with the appetite for higher-risk investments rather than acting as a standalone store of value.

The setup is bearish. Money leaving Bitcoin ETFs is not simply going to cash but is being selectively re-deployed into Ether, XRP, and Solana exposure. This rotation shows capital is being re-cut and re-allocated quickly, but the net effect is a significant reduction in demand for Bitcoin itself. Without renewed ETF demand, downside pressure will persist and rallies will struggle to hold, confirming the new bear-market regime.

On-Chain Signals and the Path to a Bottom

The on-chain data now shows clear signs of capitulation, with investors taking massive losses after the crash. Bitcoin's Realized Loss has spiked to $889 million, its highest level since November 2022. This sharp spike indicates a wave of forced selling from positions underwater, a classic bear-market signal as traders finally cut their losses after the price breakdown.

This capitulation is mirrored by a critical convergence in market positioning. The metric of BTC supply in profit versus loss shows 11.1 million BTC in profit and 8.9 million in loss, a pattern that has historically signaled bear market bottoms. When the two supply cohorts balance out, it often marks the point where the worst of the selling pressure has been exhausted, setting the stage for a potential reversal.

However, the immediate path is down. A sustained break below the $70,000 key mechanical level risks a faster slide toward the high-$60,000 range. Liquidity thins out quickly below that level, with clustered liquidation points that can accelerate the move. The bottom line is that while on-chain signals point to a potential inflection, the technical flow suggests further downside before a bottom can be confirmed.