Bitcoin Slumps to 15-Month Low Amid Regulatory and Market Uncertainty

Bitcoin has dropped to $66,000, its lowest level since October 2024.

The decline is attributed to a shift in investor sentiment and broader economic factors, including Federal Reserve policy.

Strategy Inc. reported a $12.4 billion loss in Q4 due to the sharp fall in bitcoin prices, highlighting the sector's financial vulnerability.

Bitcoin has fallen to its lowest level in 15 months, with prices dropping to $66,000 as of February 2026. This marks a significant decline from its peak of $122,200 in October 2024. The drop has been attributed to negative sentiment among traditional investors and a broader shift in how cryptocurrencies are viewed as speculative assets. Despite Donald Trump's public support for cryptocurrency and regulatory easing, the market continues to experience downward pressure.

The decline has been particularly pronounced in the last few months, with Bitcoin trending toward levels last seen in early 2024 and 2021. The market is also seeing broader selloffs, with Ethereum and Solana down around 37% in 2026. The total value of the crypto market has dropped by over $2 trillion since October. Analysts note that this is partly due to concerns over the Federal Reserve's potential tightening of monetary conditions, which could negatively impact high-risk assets like Bitcoin.

Strategy Inc., a firm heavily invested in Bitcoin, reported a $12.4 billion loss in Q4, driven by the sharp drop in Bitcoin's price. The company holds over 713,000 bitcoins, and the value of its holdings has fallen below its cost basis. This loss highlights the financial vulnerability of firms with heavy exposure to Bitcoin and underscores the volatility and instability in the digital-asset sector. The firm is now facing growing scrutiny over whether it will be forced to sell part of its holdings to cover losses.

What is Driving the Bitcoin Price Drop?

Bitcoin's recent price drop is linked to several factors, including regulatory shifts and macroeconomic conditions. The nomination of Kevin Warsh as the new Federal Reserve chair has raised concerns among investors about tighter monetary policy, which could reduce demand for high-risk assets. Additionally, the broader financial market has seen a selloff, with risk assets like Bitcoin and tech stocks being hit hard. This has been compounded by growing pessimism about the future of the crypto market, with some analysts predicting prices could drop as low as $38,000.

The decline in Bitcoin is also being attributed to a reversal in institutional demand. U.S. ETFs, which were net buyers in 2025, have become net sellers in 2026. More than $2 billion in long and short positions have been liquidated this week, signaling continued selling pressure. The price of Bitcoin has been falling steadily since reaching an all-time high in October 2024, trading around 40% off its peak. This has led to significant losses for firms like Strategy Inc., which rely heavily on Bitcoin for their financial models.

What Are the Broader Implications for the Crypto Market?

The drop in Bitcoin is part of a broader downturn in the crypto market, with other major cryptocurrencies like Ethereum and Solana also experiencing significant declines. This has led to a loss of over $2 trillion in market value since October 2024. Analysts suggest that the broader crypto market is particularly sensitive to macroeconomic factors and monetary policy changes, making it vulnerable to further declines if the Federal Reserve continues to adopt a hawkish stance.

JPMorgan analysts have suggested that Bitcoin could reach $266,000 over the long term if it continues to gain traction as an investment asset. However, this is not a near-term expectation. The analysts note that Bitcoin has already dropped below its estimated production cost of around $87,000, which could lead unprofitable miners to exit the market over time. This could lower production costs and stabilize the market in the long run. However, for now, the market remains volatile, and investors are advised to remain cautious.

Michael Saylor, executive chairman of Strategy Inc., has drawn criticism after suggesting that Bitcoin could surge to $10 million if there was consensus among investors. This statement contrasts with the company's recent financial strain as Bitcoin prices slide and its share price continues to fall. Critics argue that Saylor's long-term thesis is at odds with the company's current financial position, and many are questioning the sustainability of its business model. With Bitcoin trading near $70,800 and Strategy's stock down over 70% from its July 2025 peak, the firm now faces growing scrutiny over its ability to continue operating without selling part of its holdings.