The brief recovery in crypto markets has quickly unraveled, with Bitcoin slipping back below $66,000 as last week’s sharp rally loses momentum. What appeared to be a powerful rebound is increasingly being viewed by analysts as a temporary “dead cat bounce” rather than the start of a sustained recovery.
Bitcoin Slides Again
After plunging to $60,000 late last Thursday, Bitcoin staged a nearly 20% surge on Friday, climbing close to $72,000. However, the optimism proved short-lived.
By mid-morning U.S. trading Wednesday, Bitcoin was down more than 4% over the past 24 hours, trading just under $66,000. Major altcoins also declined:
Ether (ETH) dropped roughly 5.5%
Solana (SOL) fell about 5.5%
XRP slid 3.5%
The broader crypto market continues to struggle for sustained buying interest.
Strong Jobs Data Dampens Rate Cut Hopes
The latest downturn coincides with stronger-than-expected U.S. economic data. January job growth came in at 130,000 , nearly double economist forecasts , while the unemployment rate unexpectedly fell to 4.3%.
Following the report, traders sharply reduced expectations of near-term Federal Reserve rate cuts:
March rate cut odds fell to just 6%
April rate cut odds dropped to 23%
Before the data release, markets were pricing in much higher probabilities of monetary easing.
However, some analysts argue that fading rate-cut hopes alone cannot explain crypto’s weakness, as the current bear market began in 2025 even while the Fed was cutting rates.
Investor Interest Appears to Fade
Beyond macroeconomic pressure, there are growing signs that investor enthusiasm for crypto is waning.
According to Coinglass, Bitcoin perpetual futures open interest has fallen 51% from its October 2025 peak, signaling a significant retreat in trader conviction and leverage.
In contrast, traditional markets are showing strength. South Korea’s Kospi index recently hit record highs, with monthly trading volume up 221% year-over-year. Meanwhile, crypto exchange trading volumes have declined approximately 65% over the same period.
Analysts describe the trend as an “exit-crypto” movement, with retail investors shifting capital toward more active equity markets.
Crypto-Linked Stocks Under Pressure
The weakness is also evident in crypto-related equities:
Robinhood (HOOD) dropped 12.5% after reporting a decline in crypto trading revenue.
Coinbase (COIN) fell 7% ahead of its earnings release.
Strategy (MSTR) declined 4.5%.
Bitmine Immersion (BMNR) fell 3.8%.
Circle (CRCL), Galaxy Digital (GLXY), and Bullish (BLSH) also traded lower.
There was little green across the crypto equity sector, underscoring the broad-based retreat from digital asset exposure.
Outlook
With equities, gold, and other assets showing resilience, investors appear to be reallocating capital away from crypto , at least for now. Whether this represents a temporary rotation or a deeper structural shift in sentiment remains uncertain.
For the moment, Bitcoin’s inability to sustain its rebound above $70,000 keeps the market firmly on the defensive, with traders closely watching whether the $60,000 support zone will hold in the days ahead.
