No wonder you're inexperienced
BTC briefly fell below $70,000 today, and the fear index plummeted to 11, hitting a new low since 2022
Friends are all lamenting: "The crypto winter is here" "What the hell" is flooding the screens
ETFs withdrew $2.9 billion in three weeks, with $5.4 billion in liquidations, it's a scene of lament.
But I saw a strange scene:
Cathie Wood from ARK continues to buy ARKB and Coinbase today,
UBS quietly increased its stake in MicroStrategy to $800 million.
Retail investors are in a panic, while institutions are building positions against the trend?
A friend of mine who has been in the game for 5 years said: When the fear index is below 15, watching institutional movements is more important than watching the price.
---
This morning in the group
"It's over, BTC has fallen below 70,000, this time it's really a bear market"
Immediately, a bunch of people complained: "ETF redemptions of 2.9 billion over three weeks, institutions are all fleeing" "5.4 billion in liquidations, this time it's really over" "Let's play with US stocks."
Just when everyone was preparing to collectively cut losses,
A screenshot was shared in the group: ARK bought ARKB and Coinbase again today, and UBS increased its position in MicroStrategy to 800 million.
"Aren't institutions withdrawing? Why are ARK and UBS still buying?"
"You are looking at ETF retail fund outflows, but ARK and UBS are actively managed institutions, and they are looking at 3-5 year value, not 3-5 day fluctuations. Historically, when the panic index is below 15 and institutions build positions against the trend, it has always been at the bottom range."
I suddenly remembered that in November 2022, when the FTX collapse occurred, the panic index fell to 8, retail investors were frantically liquidating, but MicroStrategy and ARK were building positions at 16,000, and 3 months later, BTC rebounded 45%.
In March 2023, during the banking crisis, the panic index was 12, and Cathie Wood increased her position in Coinbase against the trend; 3 months later, BTC rose 38%.
This time with a panic index of 11, ARK and UBS are both buying against the trend— will history repeat itself?
---
Three truths during panic moments
The first truth: not all panics are the same; it depends on "who is in panic, who is buying."
A panic index of 11 sounds alarming. But the key question is: who is in panic?
Retail investors are in a frenzy, but top institutions like ARK and UBS are building positions against the trend. This "retail panic sell-off + institutional strategic entry" window is extremely rare in history.
In November 2022, when the FTX collapse occurred, the panic index fell to 8, and retail investors and small institutions were fleeing, while only long-term investors like MicroStrategy and ARK were buying. In March 2023, during the banking crisis, the panic index was 12; retail investors panicked but Cathie Wood increased her position against the trend.
And this time, with a panic index of 11, ARK continues to buy aggressively, while UBS, a traditional financial giant, has increased its position to 800 million— this shows that institutions' confidence in long-term value has reached historical levels.
The second truth: ETF redemptions of 2.9 billion are not institutions fleeing, but retail investors.
Many people panic when they see "ETF redemptions of 2.9 billion over three weeks," thinking institutions are fleeing.
However, there are two types of ETFs: passive ETFs (like BlackRock's IBIT) and actively managed institutions (like ARK and UBS). The 2.9 billion ETF redemptions come from retail investors redeeming through ETFs, not institutions like ARK or UBS selling.
On the contrary, while ARK experiences retail panic redemptions from ETFs, they are aggressively buying ARKB and Coinbase; UBS is increasing its position in MicroStrategy to 800 million.
This is a typical "retail retreat, institutional entry" window. Retail investors panic when the price drops below 70,000; institutions see "BTC dropping from 126,000 to 70,000, a 44% retracement, returning to a reasonable valuation range."
The third truth: 5.4 billion in liquidations means that long positions have been cleared.
5.4 billion in liquidations sounds severe, but experienced traders know—liquidation peaks often correspond to the bottom range.
Why? Because long leveraged positions are the weakest link in the market. A panic index of 11 indicates that all long leveraged positions that couldn't withstand the pressure have already been liquidated. What's left are either spot holders or long-term funds like institutions.
Historically, after each large-scale liquidation, the market experiences a "rebound after the cleaning out of leverage"— after the FTX collapse in 2022, BTC rebounded 45% in 3 months; after the banking crisis in 2023, BTC rose 38% in 3 months.
The current 5.4 billion in liquidations + panic index of 11 indicates that long leveraged positions are basically cleared out, and the market is in a relatively "clean" state.
---
Experienced traders do not rely on feelings to buy the dip, but on signals.
When the panic index is below 15, I will observe four signals, and I will only build positions if all are met.
Signal 1: Panic index threshold
A panic index below 10 is a historical super bottom. When the FTX collapse happened in 2022, it dropped to 8, which was when BTC fell to 16,000.
A panic index of 10-15 is an extreme panic range. Currently, it is 11, and yesterday it was 14. 11 is more panicked than 14, but also closer to historical bottoms.
Signal 2: Institutional movement confirmation. This is the most critical signal.
If institutions also retreat in panic, it indicates systemic risks remain in the market, and one should continue to observe. However, if institutions increase their positions against the trend in panic, that indicates a buying window for retail investors.
Current status: ARK is continuously buying ARKB and Coinbase, and UBS has increased its position in MicroStrategy to 800 million— this is a very strong signal for building positions.
Signal 3: ETF fund flows
ETF redemptions of 2.9 billion over three weeks sound alarming. But if institutions are simultaneously building positions against the trend, it indicates "retail panic selling, institutional strategic entry."
This window is extremely rare in history and often corresponds to the bottom range.
Signal 4: Scale of liquidations
5.4 billion in liquidations indicate that long leveraged positions have mostly been cleared out. Liquidation peaks often correspond to the bottom range.
If all four signals are met, I will build positions in three batches: the first batch 30% (BTC = 70,000 - 73,000), the second batch 30% (another 8% drop, about 65,000), the third batch 40% (another 15% drop, about 60,000).
If the overall position is down more than 25%, close positions and reassess. If ARK/UBS stops increasing positions or starts reducing them, close positions immediately.
---
History never lies.
Past cases of "panic index below 15 + institutions building positions against the trend" have always validated the same rule.
November 2022, FTX collapse.
When the panic index fell to 8, retail investors were frantically liquidating, with voices in the crypto space declaring "crypto is dead." But MicroStrategy and ARK built positions when BTC was at 16,000. Three months later, BTC rose to 23,000, an increase of 45%.
In March 2023, during the banking crisis.
When Silicon Valley Bank collapsed, the panic index fell to 12, and retail investors were worried about systemic financial risks. But Cathie Wood increased her position in Coinbase against the trend. Three months later, BTC rose from 19,500 to 27,000, an increase of 38%.
February 5, 2026, currently.
A panic index of 11, retail investors are in a frenzy, and ETF redemptions of 2.9 billion. But ARK is buying ARKB and Coinbase, and UBS is increasing its position in MicroStrategy to 800 million.
How much will BTC rise in 3 months?
History does not simply repeat itself, but it often rhymes. In the past, cases of "panic index below 15 + institutions building positions against the trend" had a 100% chance of rebounding more than 30% within 3 months.
---
Institutions building positions against the trend is not gambling; they see long-term value that retail investors cannot.
Historically, "panic index below 15 + institutions building positions against the trend" has always been at the bottom range.
It's not about whether to buy the dip, but whether institutions are buying— the answer is that both ARK and UBS are aggressively buying.
Retail investors look at prices, while institutions look at valuations— this is the cognitive gap during panic moments.
