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The sharp sell-off in the cryptocurrency market intensified over the weekend, with Bitcoin falling below $80,000.
This deterioration led to an overall $2$$, according to the assessment published by liquidity provider Wintermute. The 10th largest liquidation event in crypto history is 55 billion in liquidations, which was the 10 most important liquidization event of all time.
It was the first time since the levels seen after the US tariffs in April 2025 that Bitcoin tested below $80,000 for the very first period since then, and it noted that selling pressure in the market had not been due to a single cause. The price move was based on “a combination of factors” weak earnings reports from the companies that were known as “Magnificent 7” (Mag7), Kevin Warsh’s nomination as FED chairman and a sharp correction in precious metals, Wintermute said.
Last week’s busy macroeconomic calendar showed the market maintaining a relatively comfortable position in spite of rising risks, Wintermute said that “the headlines digested by midweek became revolving to heavy “risk-off” rotation by Friday”. But the fact that selling usually went over into the weekend, when liquidity is low, with high leverage positions, increased liquidations volume.
In both rising and falling markets, crypto assets still fail to outperform traditional assets. This is typical bear market behavior,” Wintermute noted.
The market interpreted the nomination of Kevin Warsh as a “hawkish” signal to head the Fed was initially given by the market. Warsh previously criticized his cautious approach to quantitativeeasing (QE) and balance sheet expansion. But it was also noted that recently he has seen the US economy in a “high productivity, low inflation balance” and campaigned for interest rate cuts.
Markets have begun pricing in the hope of cut interest rates to 100 basis points by October, strategists said. Yet it was not policy expectations that led to Friday’s dollar strengthening but rather the Chicago PMI data over-reaction by 2–2 of what is expected in a statement on Friday’s behalf, which said. 4 standard deviations from .
In particular Microsoft’s weaker-than-expected earnings report, asked whether AI infrastructure investments could be a good source of current valuations. The earnings report was not a “catastrophe” but it undermined confidence in the AI story, which had led to widespread risk appetite in equity markets.
But the weakening of the artificial intelligence theme has also been reflected in selling pressure on cryptocurrencies, which are considered to be risky asset category.
The CME Comex’ circuit breakers were triggered by circuit breaksers that led to gold falling 9 percent, silver recorded as much as 26 percent in intraday trading. Rather, this doesn’t mean the end of “quantitative easing” story; it is also related to a mechanical unraveling due to liquidation of overly speculative positions through margin calls, Wintermute said.
During Wintermute’s assessment, it was also noted that the current decline is not due to structural collapses such as those in FTX, Luna or 3AC. In its remark, it said that “a sharp but organic unwinding of leverage is being caused by macroeconomic uncertainties and fluctuations in risk appetite” (e.g.
Wintermute Thinks Recovery Will Happen in the Second Half of 2026
The company said the cryptocurrency market has been “a bear market for a while,” adding altcoin performance and investor sentiment to confirm this. Yet the commentators were remarked that this cycle could recover faster than previous bear markets because there was no forced bankruptcies or systemic contagion.
The emphasis was noted that “with the strengthening of infrastructure, continued growth in stablecoin use and a decline in institutional interest (the latter half of 2026 with reductions to macroeconomic uncertainty and clarification of the Fed’s policy path)” is expected.
*This is not investment advice.
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