While the comment came from a social media post, the painful knee-jerk reaction is likely to reverberate across the board for anyone even remotely interested in crypto, as bitcoin just dropped to nearly $77,000 on Saturday and has held there ever since.
The price of the biggest digital asset didn’t just fall; down from the $80,000 floor, reaching levels not seen since the “tariff tantrums” of April 2025.
By Saturday afternoon, in thin weekend liquidity, at just over $77,000, bitcoin had seen a staggering $800 billion in market value disappear from its peak in October above $126,000, and about $2.5 billion in leveraged long positions liquidated in 24 hours.
The wipeout even pushed bitcoin out of the top 10 global assets, where it had been for a long time, now behind institutional heavyweights like Elon Musk’s Tesla and Saudi Aramco.
To say this selloff was painful would be putting it mildly, as social media is in full panic mode, and everywhere you look, there’s blood on the street. And this is not just isolated to bitcoin; this week has been painful in all types of assets, from technology stocks to precious metals.
Recessions
If you are wondering why the narrative of “digital gold” has suddenly gone silent, here is the breakdown of the three-headed monster that is currently driving the market in a state of “Extreme Fear.”
Saturday’s immediate spark was a literal explosion. Reports of a potential sharp military escalation between the US and Iran have sent risk appetite into a freeze. In a repeat of a familiar script, traders did not treat bitcoin as a safe haven; treat it as a source of liquidity.
In times of war, investors typically engage in “flight to safety”, and move capital into the US Dollar. Because bitcoin is a 24/7 market, it often acts as a “first responder” to global panic. On Saturday, it served as the world’s ATM, selling off to cover losses and find safety in a thin, low-liquidity weekend.
Not to mention that the liquidity, since the crash of October 10 (which has many fingers pointing at Binance), has never recovered, making the market dynamics even more fragile towards this weekend.
Bitcoin was not the only victim this week. The wider “store of value” trade has come under siege. Gold fell 9% in one trading session on Friday to just under $4,900, while Silver suffered a historic 26% crash to $85.30.
In a strange twist, the traditional “safe havens” of gold and silver are being sold alongside crypto. Analysts suggest that the massive rally in the US Dollar — sparked by the nomination of Kevin Warsh to head the Fed — has made these dollar-priced metals too expensive for international buyers, leading to a massive “de-risking” of all hard assets.
In early Sunday trading, both gold and silver are rebounding from that difficult Friday, up 1% and 3%, respectively. Currently, gold is trading near $4,730 and silver around $81.
The geopolitical shock hit a market that was already “bruised” by Washington’s changing political landscape. As the price fell, it triggered a massive mechanical breakdown in the markets.
According to data from Coinglass, more than $850 million in bullish bets (long positions) were eliminated in a matter of hours on Saturday when prices began to crumble, eventually totaling nearly $2.5 billion. These liquidations occur when traders borrow money to bet that the price will rise; once the price hits a certain “trap door,” the exchanges automatically sell their holdings to repay the debt. This creates a “domino effect” — forced sales lead to lower prices, which cause even more liquidations. Across the board, nearly 200,000 traders had their accounts “bloated” on Saturday.
To make matters worse, the price of bitcoin briefly dipped below the Michael Saylor Strategy (MSTR) average entry point of around $76,037, putting his massive bitcoin stack “underwater”. Panic set in that he may have to be forced to sell his stash, making the sale even more deadly.
However, CoinDesk dismissed that theory, explaining that Saylor will not be forced to sell his bitcoin stash, as none of his coins are pledged as collateral. What this means, however, is that it will hamper his ability to raise cheap capital to buy more bitcoin on the open market.
Although Saylor later issued a signal that he would “buy the dip, the damage was done. The market realized that if a large corporation, such as Strategy, could not raise more capital to buy bitcoin on the open market, the already fragile market would be left without buyers, and become vulnerable to forced liquidations and profit-taking.
Consequently, sentiment has shifted from “moonshot” optimism to defensive hedging, as investors rush to buy price insurance in the options market against further slides towards $75,000.
This contagion is already emerging in traditional finance.
While the New York Stock Exchange is closed for the weekend, US Stock Futures, which opened for trading Sunday evening (US East Coast time), are lower across the board; the Nasdaq is down 1% and the S&P 500 is off 0.6%.
Get ready for a potential messy Monday!
Perhaps the most telling part of this crash isn’t the price; is the wallet date.
According to Glassnode data, small investors are at work. “Small Fish” (holders with less than 10 BTC) have been selling bitcoin persistently for over a month. They are capitulating, horrified by a 35% decline from a high of $126,000.
Meanwhile, “mega-whales” (those with 1,000+ BTC) have been quietly adding to their stacks. This cohort has now returned to levels not seen since late 2024, effectively absorbing the currencies that panicked retail traders are arming. Although their buying was not significant enough to move the price up.
Now let’s narrow down and compare this weekend’s selloff and current market dynamics to those that have played out before.
To be clear, this cycle is not all doom and gloom. The likes of BlackRock and JPMorgan of traditional finance have been going all in on crypto through exchange-traded funds and stablecoins. Regulatory frameworks are being created around the world to make crypto more accessible and usable for the masses, and many legitimate crypto companies are trading publicly and becoming part of many fund managers’ “must-have” stock allocations. None of these were even remotely thought of during previous cycles.
But the parallels between the last four months and the onset of crypto winter in late 2021/early 2022 are perhaps growing, and while the names and methods may have changed, human behavior and the boom-bust nature of the markets have not.
The likes of Three Arrows Capital, Do Kwon and TerraUSD, BlockFi, and Sam Bankman-Fried could have been replaced by the Trump family’s alleged undisclosed profit, Michael Saylor’s massive buyouts and promises of an 11% risk-free rate in a world of 3% risk-free rates, and well-followed digital investment personalities on a Twitter team. treasury companies.
As in 2021, these new dynamics probably created a speculative bubble that probably collapsed in 2026. The only question now is how long and how deep the decline will be.
While no one has fond memories of the crypto winter 2022 – with the price of bitcoin falling by 80% – the timeline was relatively short, roughly a year from the top-down blowoff. From there, bitcoin quickly doubled in price, rising through 2023, and finally hitting a new record high in early 2024.
In theory, if there were another 80% drop from the October 2025 high of $126,000, bitcoin would be around $25,000. It’s a scary number to even think about, but it may be necessary to wipe out the worst of this past bull market grind and clear the decks for another sustained run higher.
The denouement of the 2022 bear market came not far after the collapse of FTX and the arrest of its CEO, Sam Bankman-Fried. It remains to be seen whether bracelets are necessary for any bull market personality this cycle.
“It’s only when the tide recedes that you discover who used to swim like a duck,” said Warren Buffett. The tide may not be completely out, but it sure feels like it.
Read more: How instant gratification is taking the air out of the bitcoin market
