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Bitcoin ended 2025 more than 6% lower before falling to $63,295.74 on February 5, 2026, its lowest price since October 2024. By that point, the global crypto market had lost approximately $2 trillion from its October 2025 peak of $4.379 trillion.
Bitcoin has since recovered to around $79,000, although it remains well below its October record. Platforms such as Binance provide live market data and guides on how to buy Bitcoin, but price charts alone do not explain the reasons behind a decline.
The selloff left investors trying to separate short-term triggers from the pressures already affecting the market. Available evidence points to several contributors, including Bitcoin ETF withdrawals, leveraged liquidations, falling demand for riskier assets, weakness in technology shares and concerns about US monetary policy.
Speculation can spread quickly during a selloff, so its causes need to be assessed using market data, investment flows and monetary conditions.
Crypto is feeling the impact of widespread volatility
No single event caused the decline. Reuters reported that weakening risk appetite, volatility in precious metals, falling technology shares and concerns about Federal Reserve policy all contributed. US spot Bitcoin ETFs also recorded more than $3 billion in withdrawals during January, following approximately $2 billion in December and $7 billion in November.
The selloff also coincided with losses in software and technology shares as investors questioned AI valuations and the effect of automation on established businesses. Indian IT companies including Infosys, TCS, Wipro and HCL Technologies fell sharply during the February technology selloff.
Reports connected those losses to concerns that AI tools could reduce demand for traditional outsourcing services, not simply to investment inflows creating an AI bubble.
Currency and commodity markets also experienced large price movements. The US dollar fell near three-month lows in August, while gold, silver and oil reacted differently to monetary policy, fiscal concerns, demand forecasts and geopolitical events. These assets were not all declining at the same time, so describing every asset class as struggling would be inaccurate.
Geopolitical tensions added uncertainty to global markets, but they were only one factor. Central-bank policy, inflation expectations, government debt, AI valuations and changing investor demand also influenced prices.
Crypto has become more connected with traditional markets as spot ETFs and other regulated products have brought larger institutions into the sector. Changes in liquidity, interest-rate expectations and investor appetite can therefore reach crypto more directly.
Safe Haven or High-Risk Asset?
Bitcoin is frequently described as digital gold, but its behavior has varied during periods of market stress. During the February selloff, it moved more like a risk asset as technology shares declined, ETF withdrawals increased, and leveraged positions were liquidated. That episode weakened its safe-haven case during that period, but it does not settle the long-term debate over Bitcoin’s role in investment portfolios.
Gold outperformed crypto during parts of the selloff, but its performance has not followed a straight line. As of August 24, 2026, gold futures were up 7.29% for the year. Silver, not gold, was up approximately 77% year over year.
Final thoughts
As a crypto investor, it’s perfectly normal to feel unease and pressure when the market is going through a rough patch. However, you shouldn’t jump to conclusions and assume the worst is going to happen. This can lead to emotional decisions, and we all know that emotions are not the most faithful advisors when it comes to investing. The best thing you can do during times like these is to get your information from reputable sources and block all the unnecessary noise.
Staying up to date with the latest market developments without getting caught up in rumors requires quite a balancing act. But you have to educate yourself if you want to navigate the market safely.
Once you know what causes certain trends, you’re less likely to be influenced by outlandish theories and can focus on setting goals and building your strategy. In the end, circumstances always change, and when they do, trends, whether they’re bullish or bearish, change as well.
(Image source: Ahmad Juliyanto via Vecteezy)
