By Omkar Godbole (All times Eastern unless otherwise noted)
With Bitcoin A bear market rages on, with prices falling to their lowest levels since November 2024, and its core concept – a hard cap of 21 million coins – facing new doubts.
Some observers say alternative investment vehicles such as ETFs, cash-settled futures and options, and other services such as prime brokerage loans have diminished the appeal of scarcity. These tools allow investors to acquire Bitcoin without actually owning it, creating a “synthetic supply” that floods the market.
“Once you are able to synthetically manufacture supply, the asset is no longer scarce, and once scarcity disappears, price becomes a derivatives game rather than a supply and demand market. This is exactly what happened with Bitcoin,” Bob Kendall, senior analyst and author of The Kendall Report, wrote on X.
Similar structural changes have occurred in gold, silver, oil and stocks as alternative investment vehicles emerged, Kendall wrote. In 2023, CoinDesk highlighted how the financialization of BTC creates paper claims that mimic abundance in a market defined by raw scarcity.
This is also why investors should be cautious about on-chain metrics such as “% illiquid supply,” as these metrics do not take into account the large “paper supply” from ETFs and futures, diluting the 21 million cap.
On the market, Bitcoin fell even more, falling below $70,000 for the first time in more than a year.
Senior chart analyst Peter Brandt said the sell-off had all the hallmarks of a campaign sell-off, with coordinated selling by institutions and large traders rather than retail capitulation. Brandt isn’t sure to what level it will drop or when it will stop.
Most observers expect shares to drop below $60,000, while companies like Stifel fear a drop to $38,000 due to growing correlation with tech stocks, which have also taken a beating recently.
Hyperliquid’s HYPE remains the only consistent hiding place. The coin is up 11% year-over-year, while BTC is down nearly 19%. Another interesting coin is TRX, which is down just 2% and could outperform as financial firm Tron Inc. buys the dip.
In traditional markets, the VIX index, Wall Street’s so-called fear gauge, is moving back toward its January highs above 20.00, signaling risk aversion. Trends in the U.S. Treasury market point to expectations of a reduction in the size of the Federal Reserve’s balance sheet. Stay alert!
Read more: For analysis of today’s altcoin and derivatives activity, see Today’s Cryptocurrency Market
What to see
For a more comprehensive list of this week’s events, see CoinDesk’s “Crypto Week Ahead.”
- cryptocurrency
- February 5: Zilliqa will undergo a hard fork to support Cancun.
- Macro
- February 5, 2 pm: Mexican interest rate decision (previous value 7%)
- February 5, 4:30 p.m.: Fed balance sheet as of February 4
- income (Estimate based on FactSet data)
- February 5: Bullish (BLSH), pre-market, $0.15
- February 5: Strategy (MSTR), post-market, -$18.64
- February 5: IREN Limited (IREN), post-market, -$0.18
- February 5: CleanSpark (CLSK), post-market, -$0.02
Token event
For a more comprehensive list of this week’s events, see CoinDesk’s “Crypto Week Ahead.”
- Governance votes and calls
- February 5: PancakeSwap co-hosts an Q&A (AMA) session with Arbitrum.
- February 5: Olympus will host a community call and live Q&A session.
- February 5: Aster will host an AMA with its CEO.
- Unlock
- February 5: Unlocks 5% of its circulating supply, worth $31.52 million.
- February 5: Unlocking 2.31% of its circulating supply, worth $26.46 million.
- Token issuance
- No major launches are planned.
Meeting
For a more comprehensive list of this week’s events, see CoinDesk’s “Crypto Week Ahead.”
market trend
- BTC is down 1.62% since 4pm ET on Wednesday to $71,467.00 (24 hours: -6.52%)
- ETH rises 0.24% to $2,130.50 (24 hours: -5.93%)
- CoinDesk 20 down 1.68% to 2,077.53 (24 hours: -7.15%)
- The comprehensive pledge rate of Ethereum CESR increased by 18 basis points to 3.01%
- The BTC financing interest rate on Binance is 0.0008% (annualized 0.8793%)
- DXY rose 0.29% to 97.90
- Gold futures fell 1.22% to $4,890.20
- Silver futures fell 7.55% to $78.02
- The Nikkei 225 closed down 0.88% at 53,818.04 points
- The Hang Seng Index closed up 0.14% to 26,885.24 points
- The FTSE fell 0.43% to 10,357.59
- The Stoxx Europe 50 index fell 0.36% to 5,949.05
- The Dow closed 0.53% higher on Wednesday at 49,501.30
- The S&P 500 closed down 0.51% at 6,882.72 points
- The Nasdaq Composite Index closed down 1.51% at 22,904.58 points
- The S&P/TSX Composite Index closed up 0.56% at 32,571.55 points
- The S&P 40 Latin America Index closed down 2.89% at 3,653.05 points
- The U.S. 10-year Treasury bond rate fell 0.8 basis points to 4.27%
- E-mini S&P 500 futures unchanged at 6,904.75
- E-mini Nasdaq 100 futures rose 0.14% to 25,033.50
- E-mini Dow Jones Industrial Average futures fell 0.25% to 49,466.00
Bitcoin Statistics
- Bitcoin dominance: 59.26% (-0.39%)
- Ethereum-Bitcoin ratio: 0.02981 (1.56%)
- Computing power (seven-day moving average): 913 EH/s
- Hash price (spot): $32.02
- Total fee: 3.22 BTC / $240,320
- CME Futures Open Interest: 114,080 BTC
- BTC in gold: 14.6 ounces.
- Bitcoin and gold market capitalization: 4.77%
technical analysis
- This chart shows the daily price fluctuations of decentralized exchange Hyperliquid’s HYPE token.
- HYPE’s price has surged above the downtrend line from its September highs.
- The breakout suggests the path of least resistance is to the upside and shifts focus to resistance at $50.
crypto stocks
- Coinbase Global (COIN): Closed Wednesday at $168.62 (-6.14%), after closing at $166.07 pre-market, -1.51%
- Circle Internet (CRCL): Closed at $55.05 (-1.98%), -1.25% at $54.36
- Galaxy Digital (GLXY): Closed at $20.16 (-8.28%), -1.49% at $19.86
- Bullish (BLSH): Closed at $27.20 (-1.59%), -0.51% at $27.06
- MARA Holdings (MARA): Closed at $8.28 (-8.51%), -1.81% at $8.13
- Riot Platforms (RIOT): -7.82% to close at $14.14, -1.34% to close at $13.95
- Core Scientific (CORZ): Closed at $16.15 (-8.96%), +0.37% at $16.21
- CleanSpark (CLSK): Closed at $10.22 (-10.04%), -1.47% at $10.07
- CoinShares Valkyrie Bitcoin Miner ETF (WGMI): Closed at $40.29 (-11.06%)
- Exodus Movement (EXOD): Closed at $10.70 (+2.20%)
Cryptocurrency Treasury Corporation
- Strategy (MSTR): Closed at $129.09 (-3.13%), -3.24% at $124.91
- Strive (ASST): Closed at $0.59 (-13.20%), -6.74% at $0.55
- SharpLink Gaming (SBET): Closed at $7.08 (-7.57%), -2.54% at $6.90
- Upexi (UPXI): Closed at $1.36 (-12.26%), -2.21% to close at $1.33
- Lite Strategies (LITS): Closed at $1.06 (-7.83%)
ETF flows
Spot BTC ETF
- Daily net traffic: -$544.9 million
- Cumulative net flow: $54.73 billion
- Total BTC holdings are approximately 1.28 million
Spot ETH ETF
- Net daily traffic: -$79.4 million
- Cumulative net flow: $11.94 billion
- The total holdings of ETH are approximately 5.92 million
Source: Farside Investors
when you are asleep
Miners squeezed as Bitcoin’s $70,000 price fails to cover $87,000 production costs (CoinDesk): Bitcoin is now about 20% below its estimated average production cost, adding to financial pressures across the cryptocurrency mining industry.
Precious metals, oil prices slip as global tensions ease; copper falls (Reuters): Commodity prices from silver and gold to crude oil and copper plunged on Thursday as global tensions eased following the end of talks between China and the United States. China and the United States will also negotiate with Iran.
Trillions of Dollars in Tech Losses Trap Stocks All Along the Road to Artificial Intelligence (Bloomberg): Hundreds of billions of dollars in stock, bonds and loans have been wiped out of Silicon Valley companies big and small, with software stocks at the epicenter.
