Bitcoin’s February Decline

Bitcoin is set to close February with a significant 21% drop, marking it as the second-worst February in cryptocurrency history. The steepest drop occurred in 2014 when Bitcoin lost 30% after the collapse of the once-dominant exchange Mt. Gox.

Current Trading Status

Bitcoin is currently trading just above $80,000, having briefly dipped below $79,000 in the past 24 hours. Analysts from Coinbase attribute this decline to a lack of bullish catalysts. In their view, the pullback is driven by an absence of positive near-term factors combined with a lack of technical support between $80,000 and $95,000.

Market Context

While Bitcoin struggled, global stock markets demonstrated resilience, buoyed by continued strength in the AI sector. Nvidia’s fourth-quarter earnings report on February 26 surpassed expectations, reinforcing investor confidence in AI-driven growth. Additionally, gold maintained its upward trend, thanks to central bank purchases.

Macroeconomic Concerns

The Coinbase report highlights weakening macroeconomic sentiment in the U.S. Key indicators have shown a 10% month-over-month decline in the University of Michigan Consumer Sentiment Index and a 7% drop in the Conference Board’s Consumer Confidence Index, heightening concerns about an economic slowdown and affecting risk assets, including cryptocurrencies.

Institutional Investor Activity

Reflecting cautious market sentiment, institutional investors withdrew over $2.9 billion from U.S. spot Bitcoin ETFs last week. Analysts observed a risk-off trend in the lending market, characterized by reduced leverage and decreased funding rates.

> This is not investment advice.