Crypto Market Crash Today: Bitcoin Falls Below $77K as Liquidations Surge

The crypto market crash today has intensified as Bitcoin slipped below the $77,000 mark amid a cascade of forced liquidations and structural market constraints. Major altcoins including XRP, Chainlink, and Monero extended their losses as traders faced escalating margin calls and shallow order book conditions that amplified price swings.

Bitcoin was trading around $76,941 at the time of reporting, down 2.6% over the preceding 24 hours. The broader crypto market capitalization contracted 2.8% to approximately $2.6 trillion. Altcoins bore heavier losses across the board, with XRP declining 4.5% to $1.59, Chainlink sliding 5.5% to $9.48, and Monero dropping a steeper 12% to $405.

The crypto market crash today stems primarily from market structure dysfunction rather than headline-driven events, according to analysis from The Kobeissi Letter. The firm highlighted three major liquidation waves totaling roughly $1.3 billion within just 12 hours, demonstrating how overleveraged positions can trigger cascading sell-offs when liquidity dries up.

Liquidations Accelerate as Leverage Unwinds

Market liquidation activity surged dramatically during the sell-off. CoinGlass data showed that liquidations over the past 24 hours jumped 79% to $520 million, while open interest climbed 4% to $108 billion. This dynamic reveals a critical pattern: traders continued deploying leverage even as market conditions deteriorated, leaving their positions exposed to sharp drawdowns once prices fell further.

The underlying issue is straightforward—when order books lack sufficient depth, even moderate selling pressure can trigger violent price gaps. Heavy leverage in such an environment becomes a domino effect. As positions get cleared out at cascading price levels, more stop-losses trigger, which attracts further selling. The Kobeissi Letter emphasized this market structure vulnerability as the primary culprit behind the extended decline.

Beyond crypto-specific factors, external headwinds have added pressure. Hawkish signals from the Federal Reserve and a strengthening U.S. dollar have dampened broader risk appetite. Bitcoin, increasingly trading like a high-risk tech stock rather than a uncorrelated asset, has felt the impact acutely. Geopolitical tensions and ongoing regulatory uncertainty—with key stablecoin and market structure legislation stalled in Congress—have further eroded market confidence.

Sentiment deteriorated sharply alongside prices. The Crypto Fear & Greed Index fell to 14, firmly anchoring sentiment in extreme fear territory. The average relative strength index hovered around 35, indicating buyers remain hesitant to step in and support the market.

Analyst Perspectives: Bear Case vs. Recovery Potential

The technical landscape has triggered conflicting interpretations among analysts. One bearish camp points to Bitcoin breaking below several medium-term support levels, noting that stretched conditions beneath lower Bollinger Bands and weakening momentum could signal deeper corrections ahead. Some analysts, including contributors at CryptoQuant, warn of potential tests into the mid-$70,000 range if selling pressure persists.

However, others see a rebound setup taking shape. Oversold technical readings have preceded short-term recoveries in past episodes, and February historically represents a strong month for Bitcoin performance. These analysts suggest that a move above $80,000 could unlock a broader recovery if spot ETF outflows stabilize and macro conditions improve.

XWIN Research Japan, an analyst firm contributing to CryptoQuant’s platform, expressed a more measured view. Their Apparent Demand indicator revealed a net outflow of approximately 19,000 BTC in late January, suggesting soft new demand and mounting supply pressure. However, the firm assessed current conditions as more akin to a mild, range-bound correction rather than the onset of a full-scale bear market.

Notably, much of the recent selling appears driven by profit-taking rather than capitulation. While inflows into spot ETFs have moderated and purchases from large corporate holders have cooled, few clear signals of widespread panic-selling among long-term holders have emerged. This nuance matters for determining whether the crypto market crash represents a temporary dislocation or the beginning of a more sustained downtrend.

The path forward depends heavily on near-term catalysts, including major U.S. economic data releases such as non-farm payrolls and inflation figures expected later in the month. Until macro clarity emerges and liquidity conditions stabilize, the crypto market crash conditions are likely to persist.