February 5th, longs were liquidated by 90%!
What is wrong with cryptocurrency?
According to various communities and media, the reasons summarized are as follows; it could actually be more... we could list 100 reasons if you wish!
1. Last October's leverage liquidation... the market has still not recovered.
2. Digital Asset Treasury (DAT) stagnation.
3. Capital reversal from criminal groups: after the U.S. Department of Justice sued the Cambodian Prince Group last October, major capital flows reversed.
4. Quantum fear (real).
5. Huge artificial intelligence opportunities (opportunity cost):
Capital is shifting towards the AI field.
Talent is shifting towards the AI field.
Miners are shifting towards AI.
6. Bitcoin is considered American: Chinese buyers have decreased, who previously drove the surge in precious metal prices in large numbers.
7. Major whales and institutions taking over, overly profit-driven offices and retail:
- Shift from Cypherpunk/Rebel tech to ETF tech.
- Cryptocurrency was once prepared for the unsuitable and geniuses, now it is a line in 401k.
8. Connection to Uncle Big and political risks: what will happen once the Democrats return?
9. Very little innovation (since Hyper).
10. Sol casino massacre, draining liquidity (Memecoin supercycle).
11. Token oversupply: currently tracking 29.91 million cryptocurrencies.
Another report stated that Wintermute sold 6,172 BTC in 30 minutes, leading to a $619M liquidation cascade. This was described as a “liquidity hunt,” amplifying market volatility but could be market-making behavior rather than malicious selling.
On February 5th, there were signs of large BTC movements, but it seemed more like neutral operations in the market rather than clear selling.
Forced to reduce risk, World Liberty sold $5 million to avoid their Aave position being liquidated, while Wintermute continued to sell over a week during low liquidity periods.
When you have billions of dollars in unrealized losses in your account, and market volatility spikes to 75%, you won't sit idly by. Everyone is scrambling to reduce risk exposure before the next round of volatility down. #加密市场反弹 #美国伊朗对峙 #何时抄底？ $BTC $BNB
