Bitcoin News This Week — ChangeHero Digest

Bitcoin's struggle continues this February, trading around $66,000 after briefly touching $65,000—a level that hasn't sparked the kind of relief rally traders were hoping for. Instead, the digital asset is on track for its fourth consecutive weekly decline, shedding nearly 6% over the past five days. The culprit? A familiar mix of macro uncertainty and risk-off sentiment that's dragging down everything from tech stocks to altcoins. With U.S. CPI inflation data set to drop any moment, investors are bracing for signals that could either confirm the Federal Reserve's hawkish stance or offer a glimmer of dovish hope.

The bigger picture? Bitcoin's year-to-date performance is down 22%, logging four straight months of losses through January. Meanwhile, gold is up 16% this year alone—building on a blistering 65% rally in 2025. That divergence is raising eyebrows. Deutsche Bank analyst Marion Laboure summed it up bluntly: Bitcoin is no longer acting as "digital gold." Institutional ETF outflows have piled up since the October downturn, and the narrative that crypto would hedge against chaos is looking shakier by the day.

Macro Headwinds and the Fed Factor

The immediate pressure on Bitcoin stems from a simple dynamic: risk assets don't thrive when rate-cut hopes evaporate. Strong U.S. jobs data earlier this week showed robust payroll gains and a lower unemployment rate, effectively killing any near-term expectations of Federal Reserve easing. That reality check rippled through crypto markets, where speculative assets like Bitcoin tend to struggle when monetary policy remains tight.

The CPI report expected this week is the next major test. If inflation surprises to the upside, it reinforces the Fed's cautious stance and likely keeps Bitcoin under pressure. If it comes in cooler than expected, there's a narrow path for a short-term bounce—but the damage to sentiment may already be done. Wall Street technology stocks slid overnight, and Asian equities faltered on Friday as fears mounted that automation and AI tools could undermine traditional business models.

The interconnectedness of risk assets is on full display. Bitcoin's correlation with equities has tightened, not loosened, and that's a problem for anyone hoping crypto would decouple during turbulent times. The notion of Bitcoin as a safe haven is taking a beating.

The Liquidity Trap and Derivatives Pressure

Beyond macro factors, Bitcoin's price action is being shaped by technical dynamics that are amplifying volatility. 10X Research pointed out that Bitcoin has fallen back into a "structural liquidity gap" created during the post-election rally in November 2024. Here's what that means: when Bitcoin surged from $70,000 to $90,000 in just 10 to 12 days, it left behind a thinly traded zone—a liquidity vacuum where few market participants had positioned. Now that price has retreated into that range, there's less support to cushion the fall.

Markus Thielen, head of research at 10X, explained that the sell-off intensified near $75,000 due to negative option gamma. When market makers hedge their options exposure, they're forced to continuously sell futures as price drops, creating a feedback loop that exacerbates downside volatility. The good news? Thielen believes a reversal could materialize once this derivatives-driven pressure around $60,000 is digested. The bad news? That implies Bitcoin may need to test or break below $60,000 before finding sustainable support.

For now, the market is stuck in a zone of vulnerability. Bitcoin is down roughly 45% from its October all-time high above $126,000, and earlier this month it posted its worst daily drop since November 2022. That kind of selling pressure doesn't evaporate overnight.

Strategy's Dominance and Corporate Accumulation

While retail sentiment sours, one entity has been buying aggressively: Strategy (formerly MicroStrategy). According to Bitcoin Magazine, Strategy accounted for more than 90% of net new corporate Bitcoin purchases in January 2026, acquiring 40,150 BTC and ending the month with 712,647 BTC on its balance sheet. That's not a typo. Strategy alone is responsible for nearly two-thirds of all publicly held Bitcoin, which now totals roughly 1.13 million BTC across all public companies.

Strategy's January purchases represented 93% of gross public-company buying and 97.5% of net additions after accounting for sales. The firm's Q4 2025 disclosure outlined a seven-year plan projecting roughly 2.5x growth in Bitcoin per share by 2032. Under an aggressive scenario assuming a 14% annual Bitcoin yield, the company targets 492,000 sats of BTC per share. Last week alone, it added another 1,142 bitcoin.

The scale of Strategy's accumulation is staggering—and it's not slowing down. Among 194 public companies holding Bitcoin, roughly one-third have been adding at least 1 BTC per day on average since adopting a treasury strategy. Twenty firms accumulate 10 BTC per day or more. Treasury-focused companies collectively add an average of 357 BTC per day over more than five years.

But here's the flip side: when Bitcoin dips below $65,000, treasury-centric stocks get hammered, falling 30–35% in early February. Strategy's business model is a leveraged bet on Bitcoin, and that leverage cuts both ways. The company's success hinges on Bitcoin's long-term trajectory, but in the short term, its stock price amplifies every move in crypto markets.

Meanwhile, miners are net sellers. Mining companies hold around 124,833 BTC, about 11% of total public-company holdings, and they were net sellers in January with a loss of 290.9 BTC as Riot and Bitdeer reduced their balances. That's a subtle but important signal: miners need to cover operational costs, and when prices sag, they liquidate inventory.

Institutional Sentiment and Analyst Revisions

The institutional narrative around Bitcoin is shifting. Standard Chartered analyst Geoff Kendrick recently slashed his year-end targets, cutting Bitcoin from $150,000 to $100,000 and Ether from $7,500 to $4,000. He warned that Bitcoin could fall to just below $50,000 before rebounding. That's a significant downgrade from one of crypto's most bullish voices on Wall Street.

The revision reflects a broader reassessment of the market's near-term outlook. Billions of dollars have flowed out of institutional ETFs since October 2025, and the momentum that defined the post-ETF approval euphoria has clearly faded. Deutsche Bank's Marion Laboure argued that Bitcoin's failure to track gold's rally undermines the "digital gold" thesis. If Bitcoin can't hold up during geopolitical uncertainty or inflation fears, what exactly is its value proposition?

That's the question haunting the market right now. Bitcoin's correlation with risk assets means it's behaving more like a tech stock than a safe haven. And with equity markets wobbling under the weight of AI disruption fears and Fed policy uncertainty, Bitcoin is getting dragged along for the ride.

On the regulatory front, there's a glimmer of positivity. The CFTC appointed leading cryptocurrency executives to its newly formed Innovation Advisory Committee, including Coinbase CEO Brian Armstrong, Ripple CEO Brad Garlinghouse, Robinhood CEO Vladimir Tenev, and Uniswap Labs CEO Hayden Adams. The committee will advise on emerging technologies such as blockchain and artificial intelligence as they intersect with derivatives and crypto markets. That's a constructive step toward clearer regulation, but it's unlikely to move the needle in the near term.

Pension Fund Losses and Institutional Risk

Here's where things get uncomfortable: public pension funds are starting to feel the pain of crypto exposure. North Carolina Retirement Systems began investing pension money in cryptocurrency in late 2025 after a law enabled such investments. Since then, more than half the value of its crypto holdings has been wiped out—down $33 million since September 30, with additional losses of tens of millions in crypto-related company investments.

The state's investment in Strategy was valued at $51 million as of September 30. The state treasurer later confirmed the holdings were worth just $18 million—down about 65%. North Carolina also owns Coinbase shares that fell from $32 million to an estimated $15 million, and Robinhood holdings that were down 41% since September to about $38 million.

The paper loss is less than 1% of the roughly $140 billion fund, so it's not a systemic crisis. But it's a politically sensitive issue. Destin Hall originally proposed allowing North Carolina's pension plan to invest up to 10% in crypto, later reduced to a 5% cap after pushback. Now that the losses are public, critics are questioning whether pension funds should be exposed to such volatile assets at all.

This isn't just a North Carolina problem—it's a warning shot for any institutional investor considering crypto exposure. The volatility that makes Bitcoin attractive for aggressive portfolios is a nightmare for fiduciaries managing retiree savings.

Bithumb's Costly Mistake and Exchange Risk

While institutional investors grapple with losses, one South Korean exchange just experienced a nightmare scenario. Bithumb accidentally credited customers with 620,000 bitcoins instead of 620,000 won during a February 6 "random box" promotion. An employee entered prize amounts in bitcoin rather than won—a catastrophic input error. The intended prizes totaled 620,000 won (about $450) for 695 qualifying customers. Instead, 249 opened their prize boxes and received the equivalent of billions of dollars in bitcoin.

Bithumb moved quickly to reverse the error, correcting 99.7% of the erroneous credits by reversing internal ledger entries. But about 13 billion won ($9 million) remained unrecovered after some recipients sold or withdrew the mistakenly credited funds before the error was detected. Financial authorities said 86 customers sold about 1,788 bitcoins in the 35 minutes before Bithumb froze the affected accounts, triggering a brief price drop on the exchange.

The incident exposed "structural problems" in how exchanges operate internal ledger systems, according to Lee Chan-jin of South Korea's Financial Supervisory Service. The FSS escalated its response to a full investigation, and South Korea's parliament scheduled an emergency hearing for February 11 to question Bithumb and financial authorities.

Legal experts are divided on whether recipients who sold the mistakenly credited crypto could face criminal prosecution. A 2021 Supreme Court ruling held that cryptocurrency does not constitute "property" under Korean criminal law, creating a gray area. Bithumb said it is holding one-on-one talks with roughly 80 customers who cashed out, asking them to return the won equivalent voluntarily. The company insists the incident was unrelated to external hacking or a security breach.

This is a cautionary tale about operational risk. Even a well-established exchange can make a simple human error that cascades into millions of dollars in losses. For customers, it's a reminder that not all windfalls are legitimate—and selling mistakenly credited funds could land you in legal hot water, even if the law isn't entirely clear.

Altcoin Weakness and Ether's Struggles

Bitcoin isn't suffering alone. Most altcoins traded modestly lower on Friday: Ethereum fell 1.3% to $1,944.76, XRP fell 1.7% to $1.35, Solana eased 2.3%, and Polygon jumped 4% while Cardano edged lower. Dogecoin traded largely flat. Ether, in particular, has struggled, hovering below $2,000 and extending its year-to-date losses to about 30%.

The weakness in altcoins suggests this isn't just a Bitcoin-specific problem—it's a broader crypto market reckoning. When Bitcoin struggles, altcoins typically amplify the pain. And with institutional attention focused on Bitcoin ETFs, many altcoins are being left behind. The narrative that a new alt season is just around the corner keeps getting delayed.

The Bottom Line

Bitcoin is stuck in a vise grip between macro uncertainty and technical fragility. The Federal Reserve's hawkish stance, driven by resilient jobs data and sticky inflation, has snuffed out hopes of rate cuts and drained liquidity from risk assets. Bitcoin's failure to track gold's rally has shattered the "digital gold" narrative, at least for now, and institutional ETF outflows signal waning conviction among the smart money.

On the technical side, Bitcoin has fallen back into a liquidity trap created during last year's post-election surge. Negative option gamma is amplifying downside volatility, and 10X Research suggests the market may need to flush out derivatives pressure around $60,000 before any meaningful reversal takes hold. That implies further pain before relief.

Strategy's relentless accumulation—accounting for more than 90% of corporate Bitcoin purchases in January—is a bullish signal for long-term believers, but it's also a sign of just how concentrated ownership has become. When a single company holds two-thirds of all publicly traded Bitcoin, the market's resilience depends on that company's ability to keep buying. And when Bitcoin dips, Strategy's stock gets crushed, creating a feedback loop of volatility.

The most important takeaway? Bitcoin's next move hinges on whether it can hold $60,000 as a floor. If that level breaks convincingly, Standard Chartered's target of $50,000 comes into play, and the market will need to reassess whether this is a correction within a bull market or the start of something worse. Until inflation cools, the Fed pivots, or liquidity conditions improve, Bitcoin's path of least resistance remains downward. Gold is winning the safe-haven battle, and Bitcoin is behaving like what it increasingly appears to be: a leveraged bet on risk-on sentiment.