With the impact of many important developments, the Bitcoin price fell below $ 80 thousand and a liquidation of $ 2.55 billion was triggered. Cryptocurrency investors had already been struggling with boring markets for 3 months, and we were expecting to escape from this narrow range with a violent breakout. So what does Wintermute expect? In cryptocurrencies what will happen?
Why Did Cryptocurrencies Fall?
Microsoft earnings had already paved the way for this decline. Mag7’s mixed-signal earnings reports were one of the main reasons for the decline. Reasons such as the sharp decline in gold and silver prices and the Warsh Fed candidacy also paved the way for massive sales that triggered each other. wintermute He says cryptocurrencies still perform poorly in rising and falling markets compared to other assets, which is typical of bear markets.
“There was a weak tone last Monday after rejecting the upper end of the $95-85k BTC range that we have been trading in for the last two months. Over the weekend, BTC fell below $80k for the first time since Trump’s tariff announcement in April 2025. But unlike then, there wasn’t a single clear catalyst to point to this time.
Instead, markets needed a few days to digest the triple threat of disappointing Mag7 earnings that debunked the AI narrative, Kevin Warsh’s surprise Fed Chair nomination, and a violent unraveling of the froth in the precious metals complex.
The delayed response meant that the actual selling occurred on a traditionally illiquid weekend, and with leverage still high at the start of the week, the result was $2.55 billion, the 10th largest liquidation event in crypto history. “Crypto was the worst performing asset among all assets, except for the S&P500 and crude oil which recorded positive results.”
What Will Happen to Cryptocurrencies?
For now, as volatility has returned to the market, analysts say the price discovery phase has begun. It’s always been a question of when, not if, volatility will return, and last week was the perfect environment for that. Last week’s positions also increased the possibility of the move being downward.
“This is reflected on the table as it is felt that the market is generally sluggish and participation is limited. While institutions have supported the markets throughout January, last week’s headlines have increased uncertainty and there are very few new buyers left in the market at these levels.”
Frankly, we can say that we have been in a bear market for a while, especially looking at the altcoin performance, how narrow the rallies have been, and the sentiment in X. The difference this time is that it is not the result of a structural collapse (FTX, Luna, 3AC etc.), but rather that macro and volatile trends lead to organic (but not always orderly, see 10/10) deleveraging driven by positioning, risk appetite and narratives.”
The direction is down for now and we are in bear markets. So the surprising thing is of BTC It will target 98 thousand dollars and above again. So is there no hope?
Unlike previous bear markets cryptocurrencies This time it is not falling due to a few catalysts or crypto-specific issues. That’s why Wintermute analysts are hopeful.
“Without forced bankruptcies or a domino effect, this cycle could unravel faster than previous bear markets. The infrastructure is stronger, stablecoin adoption continues to rise, and institutional interest has not vanished, it has just been sidelined. Mindshare could bounce back quickly once conditions improve once macro uncertainty fades and the Fed’s policy path becomes clear, likely in the second half of 2026.”
Currently, post-liquidation positioning is lighter, but conviction is weak. After staying within the range limits for two months, we returned to price discovery. “Although it is too early to talk about a meaningful uptrend, if such a trend were to occur, there would be a clearer break from the recent downtrend than we have seen in previous bear markets, as there is no structural damage to the crypto ecosystem.”
