Bitcoin fell below $72000 at one point! The cryptocurrency market has suffered a heavy blow

1、 Breaking through the critical threshold, the decline and market value shrinkage are both shocking

The Bitcoin crash this time is not a short-term small fluctuation, but a market shock with astonishing magnitude and wide-ranging impact, and all core data highlight the severity of the market. According to market monitoring data, Bitcoin experienced a sudden plunge during the late trading session in New York, falling below the key integer of $72000 at one point and reaching as low as $71739. This price level dates back to November 2024 and is the lowest in nearly 15 months. In terms of decline, compared to the price peak in October last year, the cumulative drawdown of Bitcoin has exceeded 42%, with a decline of about 17% in 2026 alone. The short-term downward momentum is rapid, exceeding the expectations of most investors.

The sharp decline of Bitcoin quickly spread to the entire cryptocurrency market, triggering a chain reaction. Ethereum SOL、 Mainstream cryptocurrencies such as Dogecoin have experienced simultaneous declines, with Ethereum and SOL falling by over 10% at one point, and Dogecoin falling by nearly 9%. The entire cryptocurrency market has fallen into a general downward trend. According to CoinGecko data, since its peak in October last year, the total market value of encrypted assets has shrunk by about $1.7 trillion, with a decrease of over $460 billion in just the past week; According to Coinglass data, the total amount of cryptocurrency contracts liquidated in a single day reached 2.559 billion US dollars, with over 420000 people liquidated. Among them, multiple liquidation accounted for 93.8%, and a large number of investors suffered huge losses due to high leverage operations, further exacerbating the panic atmosphere in the market.

2、 Global risk aversion dominates, multiple factors resonate and exert pressure

Bitcoin's drop below $72000 this time seems to be the result of concentrated market sentiment, but the core is the inevitable combination of multiple factors such as global risk aversion and changes in the macro environment. As market analysis suggests, the primary driving force behind this sharp decline is the widespread risk aversion in the global market. Against the backdrop of tightening global financial conditions and high geopolitical uncertainty, investors' risk appetite has sharply declined and they have begun to sell various risk assets on a large scale. Although Bitcoin is considered a "safe haven tool" by some investors, it has been classified as a high volatility risk asset in this round of market turbulence and has become a key target for selling.

Specifically, multiple external and internal factors resonate, jointly crushing market confidence. From a macro perspective, US President Trump nominated former Federal Reserve Governor Kevin Walsh as the next chairman of the Federal Reserve. The market generally expects Walsh to adopt a policy combination of "balance sheet reduction and limited interest rate cuts" after taking office, which will push up the US dollar index and US bond yields, prompting funds to quickly withdraw from assets such as cryptocurrencies and precious metals and flow towards safer safe haven products, directly suppressing the price of Bitcoin. From the perspective of the market, the cumulative price increase of Bitcoin in the early stage is significant, and there is a strong desire for profit taking to escape. Coupled with the increase in gold futures trading margin requirements by institutions such as the Chicago Mercantile Exchange, it indirectly affects the leverage funds in the cryptocurrency market, forcing some highly leveraged speculators to close positions and further amplifying the price decline. In addition, factors such as institutional funding instability and regulatory uncertainty have intensified the selling pressure on the market, adding insult to injury to the price of Bitcoin.

3、 The 'crisis of faith' is brewing, and the value narrative is being questioned

Compared to the price crash itself, what worries the cryptocurrency market more is that the "crisis of faith" triggered by this crash is continuing to ferment, posing unprecedented challenges to the value narrative that has long supported Bitcoin. For a long time, Bitcoin has been regarded as a core belief by many investors with labels such as "decentralization," "anti inflation," and "value storage." It is even regarded as "digital gold." However, in this round of global market turbulence dominated by risk aversion, Bitcoin's performance has seriously deviated from its positioning as a "risk averse asset.

The clear statements of market participants demonstrate the wavering of this belief. Shiliang Tang, Managing Partner of Monarq Asset Management, explicitly stated that the current cryptocurrency market is experiencing a "crisis of faith", and investors have doubts about the medium - to long-term narrative and short-term pricing mechanisms of cryptocurrency assets. More importantly, the price of Bitcoin is highly synchronized with risk assets such as the US stock market, and has not shown resilience independent of risk assets. Instead, it has become a highly volatile long tail risk asset, and its value narrative of "anti inflation" and "safe haven" has gradually disintegrated. In addition, the drastic fluctuations in the price of Bitcoin make it difficult for it to become a reliable value scale and trading medium. A large number of retail investors have low interest, and trading volume continues to shrink, further highlighting the fragility of market beliefs. Many investors have begun to re evaluate the investment value of Bitcoin, and even choose to completely exit.