Bitcoin Continues Bull Run, Briefly Surpasses $70,000

Bitcoin briefly surpassed $70,000 on Thursday, marking its highest level since November 2024. This price surge came as broader risk sentiment shifted and speculative buying increased amid institutional selling. The price action occurred amid a broader crypto market that has lost $2 trillion in value since hitting a peak in October 2024.

On-chain data from multiple sources indicates a transition in market dynamics, with weak spot demand and tightening liquidity. The Coinbase premium has remained negative since October, signaling reduced U.S. investor participation. Additionally, U.S. spot bitcoin ETFs, once net buyers, have turned into net sellers, creating a demand gap in the market.

Regulatory developments also continue to weigh on the market. U.S. Treasury Secretary Scott Bessent urged the passage of the Digital Asset Market Clarity Act, a bill that remains stalled in the Senate. Industry participants have resisted the legislation over disagreements on key provisions, particularly around stablecoin yields and token classification.

Why Did This Happen?

Bitcoin's recent price action reflects a complex mix of speculative buying and institutional selling. The cryptocurrency has fallen 17% this week and 28% year-to-date, with Ether and other altcoins suffering similar declines. Bitcoin's drop below $70,000 earlier in the week triggered $2 billion in liquidations, signaling heightened volatility and uncertainty.

The price move was also influenced by broader macroeconomic concerns. The S&P 500 and Nasdaq indexes hit multi-week lows, with the tech sector under pressure as AI-related enthusiasm waned. Precious metals also saw significant losses, with silver falling as much as 18%. These moves have led analysts to question whether the market is entering a deeper bearish phase.

How Did Markets React?

Crypto-related stocks and ETFs have seen significant declines. Companies like Strategy (MSTR) reported a $12.4 billion loss in Q4 2025 due to the falling price of bitcoin. Shares in MSTR dropped 17% on Thursday, aligning with the broader crypto selloff. Other crypto-focused companies, including Bitcoin miners and ETFs, also experienced sharp declines as investor sentiment soured.

Institutional selling has become a key driver of the broader market decline. U.S. spot bitcoin ETFs have seen consistent outflows in recent months, with more than $3 billion in outflows in January alone. This trend has raised concerns about the long-term outlook for the crypto market, with some analysts suggesting the decline is not just a short-term correction.

What Are Analysts Watching Next?

Analysts are closely watching key price levels and liquidity conditions. The $70,000 level is considered a major psychological barrier, and a sustained break below this level could trigger further selling pressure. The $60,000 to $65,000 range is seen as the next area of potential support, where buyers might step in to absorb some of the downward momentum.

On-chain metrics suggest that the market is in a bearish phase, with weak spot demand and tightening liquidity. The Crypto Fear & Greed Index hit a score of 9 out of 100, the lowest level since the Terra collapse in mid-2022. This indicates that investor sentiment is extremely cautious, with many investors adopting a wait-and-see approach.

Political developments are also influencing market sentiment. The nomination of Kevin Warsh as the next Federal Reserve chair has raised concerns about potential tightening of the Fed's balance sheet. A smaller balance sheet could reduce liquidity in the financial system, which historically has been beneficial for speculative assets like cryptocurrencies.

The broader macroeconomic environment remains a key factor. Prediction markets suggest that traders expect the Fed to maintain a hold on interest rates in April, with modest expectations for a rate cut in June. This policy uncertainty continues to weigh on risk assets, including cryptocurrencies.