Bitcoin News Today: Bitcoin Falls Below $115,800 Support as Altcoins Lose $40 Billion in Five Days

Bitcoin (BTC) recently lost a key support level near $115,800, marking a significant shift in risk appetite among crypto traders. The decline, observed late last week, was accompanied by a broader capitulation from altcoin investors, with many lower-ranked tokens experiencing sharp sell-offs. On August 5, Bitcoin traded as low as $112,722.10, and the price move coincided with former support levels flipping into resistance, according to the latest Bitfinex Alphareport [1].

This breakdown followed weeks of declining order flow and open interest, indicating a shift in capital toward higher-risk assets like Ethereum (ETH) and other high-beta altcoins. However, this trend reversed quickly, with altcoins outside the top 10 experiencing a 16.3% drop in value between July 28 and August 2, wiping out roughly $40 billion in market value before a modest rebound [1].

The synchronized drawdown across both major and smaller cryptocurrencies suggests a broader de-risking trend rather than a shift in market leadership. Since its all-time high of $123,054, Bitcoin has fallen by 6.6%, while Ethereum has declined by 9% from its recent peak. The broader altcoin complex also saw a dramatic fall, starting the week at nearly $994 billion before losing those gains [1].

Among the few exceptions, ENA and PENGU posted weekly gains of 14% and 8.4%, respectively. However, these outperformers have also started to correct, with ENA down 4.1% in the past 24 hours and PENGU falling 7.6% [1].

The correction was further amplified by leverage. On August 2, liquidations across major centralized exchanges exceeded $1 billion, with over $922 million in long positions being wiped out as momentum stalled [1]. The report noted that Ethereum long liquidations accounted for a large portion of these losses, indicating that traders had heavily concentrated in ETH following its earlier underperformance.

Such a liquidation flush is often described as a “cleansing” event, helping reset open interest and positioning. However, the market is still in a reflexive and fragile phase, making sharp reversals and cascading liquidations more likely [1].

Despite the overall decline, Bitcoin has maintained structural strength compared to the rest of the crypto market. Its market cap remains above $2.2 trillion, nearly double the 2021 cycle peak, while Ethereum and the broader altcoin market have yet to surpass their 2021 highs [1]. This divergence suggests that Bitcoin is evolving into a more macro-resilient, institutional-grade asset, while the altcoin sector still lacks sustained capital flow and durable demand [1].

Bitcoin briefly bounced back above the $114,000 level after dipping below it, fueled by oversold conditions as predicted by the report. However, without signs of aggressive spot buying or ETF inflows, and given the still-hawkish stance of the Federal Reserve, the expectation remains for either consolidation or further corrections [1].

Source: [1] Bitcoin loses key support at $115,800 as altcoin traders capitulate, signaling fading risk appetite (https://cryptoslate.com/bitcoin-loses-key-support-at-115800-as-altcoin-traders-capitulate-signaling-fading-risk-appetite/)