SKN | Bitcoin Falls Below $70,000 as Sell-Off Deepens and Market Confidence Erodes

Key Points:

•  Bitcoin fell below $70,000 for the first time since November 2024, intensifying fears of further downside toward the $60,000–$65,000 range.
•  Institutional demand has reversed, with U.S. bitcoin ETFs turning into net sellers and liquidity thinning across markets
•  Bitcoin’s underperformance versus gold and its break below long-term technical levels are straining the “digital gold” narrative.

Bitcoin slid below the closely watched $70,000 level on Thursday, marking its first break beneath that threshold since November 2024 and reinforcing signs that investor confidence in the cryptocurrency market is deteriorating. The move comes amid sustained selling pressure across digital assets, weakening institutional demand, and growing skepticism over bitcoin’s long-touted role as “digital gold.”

The world’s largest cryptocurrency fell as low as $69,055, extending a decline that has now lasted more than three months. Bitcoin is down more than 45% from its October peak near $126,000, a retreat that contrasts sharply with earlier expectations of a renewed, institutionally driven bull market.

Market Structure and Technical Pressure

Several analysts have pointed to $70,000 as a critical technical and psychological support level. Its breach has heightened concerns that further losses could follow. James Butterfill, head of research at CoinShares, said the level had become a key line of defense for bulls. “If we fail to hold it, a move toward the $60,000 to $65,000 range becomes quite likely,” he warned.

Technical indicators are reinforcing the cautious tone. According to CryptoQuant, bitcoin has broken below its 365-day moving average for the first time since March 2022. Since that breakdown, the asset has fallen roughly 23% in just under three months, a pace of decline that exceeds the early phase of the 2022 bear market.

Institutional Demand Reverses

A major driver of the sell-off appears to be a reversal in institutional positioning. While large investors were widely credited with underpinning bitcoin’s rally last year, data now suggests they are pulling back. CryptoQuant noted that U.S. spot bitcoin exchange-traded funds, which were net buyers of around 46,000 bitcoin at this point last year, have turned into net sellers in 2026.

This shift has thinned market liquidity, exacerbating price swings and triggering forced liquidations. More than $2 billion worth of long and short crypto positions have been liquidated this week alone, according to Coinglass data, adding mechanical selling pressure to an already fragile market.

“This steady selling signals that traditional investors are losing interest, and overall pessimism about crypto is growing,” said Marion Laboure, an analyst at Deutsche Bank, in a note to clients. The bank has previously argued that bitcoin’s recent weakness reflects a loss of conviction rather than a single macroeconomic shock.

Store-of-Value Narrative Under Strain

Bitcoin’s underperformance relative to traditional safe havens is also weighing on sentiment. Over the past year, bitcoin is down nearly 29%, while gold has surged about 69%, supported by central bank buying and geopolitical uncertainty. The divergence has undermined the narrative of bitcoin as a reliable hedge against inflation or macro risk.

The broader crypto market has followed bitcoin lower. Ether has fallen roughly 23% this week, on track for its worst weekly performance since November 2022, while Solana has slid to around $88, a two-year low. The downturn has coincided with renewed weakness in U.S. technology stocks, with the Technology Select Sector SPDR Fund falling sharply this week, reinforcing correlations between crypto and risk assets.

From a behavioral perspective, analysts note that bitcoin is no longer trading on hype or narrative momentum. “The straight-line bull run that many expected hasn’t materialized,” said Maja Vujinovic of FG Nexus. Instead, prices are being driven by liquidity conditions and capital flows, leaving the market vulnerable when demand retreats.

Looking Ahead

The break below $70,000 raises the stakes for the weeks ahead. A stabilization in institutional flows or a broader recovery in risk appetite could help bitcoin consolidate. Absent that, analysts see a growing risk of a deeper retracement toward the low-$60,000 range. For now, the sell-off underscores a market recalibrating expectations, with confidence proving harder to rebuild than it was to lose.