On February 6, 2026, Eastern Standard Time, the cryptocurrency market experienced a rare shock, with Bitcoin plummeting over 15% within 24 hours, briefly dropping below the $60,000–$61,000 range, causing major assets like Ethereum, BNB, and SOL to collectively dive. The rapid decline in prices triggered a chain reaction in the contract market, leading to the passive liquidation of many high-leverage long positions, while retail investor sentiment quickly shifted from hesitation to panic. Meanwhile, on-chain and financial report data indicated that some institutions and large holders chose to go against the trend during this significant pullback, increasing their positions in Bitcoin and Ethereum, among other high-certainty assets. This article will analyze the funding game and emotional misalignment behind this 24-hour shock along three lines: price data, institutional actions, and regulatory discourse.
15% Plunge and Collective Drop of Major Coins: Market Resonance Decline
● Price Retracement Path: Multiple market media outlets reported that on February 6, Bitcoin's 24-hour decline exceeded 15%, with the lowest point directly breaking through the critical psychological level of $60,000–$61,000, completing a rapid shift from high levels to the "defense of $60,000." The cliff-like price drop, combined with high-frequency matching and instantaneous liquidity contraction, amplified the intraday volatility, resulting in a typical "sharp drop + weak rebound" pattern.
● Major Coins' Linked Decline: This was not a singular event for Bitcoin; during the same period, Ethereum briefly fell below $1,800, BNB dropped below $600, and SOL fell below $70, with almost all major assets affected. The simultaneous breach of previous important integer levels and dense trading zones by multiple assets led the market to view this round as a systemic fluctuation of "overall liquidity contraction + sharp decline in risk appetite," rather than a localized incident of a single chain or narrative.
● Leverage and Market Cap Impact: In this round of plummet, the total market cap significantly shrank, with the price plunge triggering a large number of forced liquidations of contracts, impacting long leverage funds first. Some chasing positions were forced to liquidate at extremely unfavorable prices. Although there is currently a lack of unified statistics on liquidation amounts, feedback from users on multiple trading platforms and the sharp decline in open contracts suggest that the short-term damage caused by this volatility to high-leverage participants was concentrated and severe.
● Disputed Low Point Data: It is important to emphasize that the more precise low point range for Bitcoin's recent drop—such as reports of touching $62,719–$63,631—is still in a pending verification state. Differences in sampling among various exchanges and data providers have led to discrepancies in the recorded lowest prices, making this disputed range unsuitable as a precise anchor point for technical analysis; future assessments should rely on a unified standard from authoritative market sources.
Panic Selling: Institutions Counter-Trend Accumulating Positions
● Large Holder's Bitcoin Accumulation: On-chain intelligence shows that during the same period when retail investors were generally reducing their positions and sentiment was rising, Vida, the founder of Equation, chose to go against the trend, cumulatively investing about $8 million to buy 128.28 BTC. Completing such a large-scale purchase during a sharp price drop indicates that these large holders prioritize long-term risk-return ratios and cost advantages over short-term volatility noise, providing a tangible "contrarian signal" to the market during extreme emotional states.
● "7 Siblings" Absorbing Ethereum Selling Pressure: On the other side, the well-known institutional address "7 Siblings" significantly increased its holdings by 17,757.77 ETH during this downturn, with a total value of approximately $34.88 million at the time. Against the backdrop of Ethereum falling below $1,800 and sentiment leaning towards "losing key levels," this action indicates that at least some large funds view the current price level as a reasonable or even favorable allocation range for the medium to long term, and their absorption of major assets has not waned due to short-term flash crashes.
● Sample and Information Source Limitations: It should be noted that the above two accumulation actions come from single on-chain intelligence or media sources, and statistically represent only "sample fragments," which cannot be simply extrapolated to conclude that "all institutions are buying." The risk preferences, debt structures, and investment horizons of different funds vary greatly, and individual large buy orders are more of a trend clue and emotional reference rather than a directly quantifiable market panorama.
● Institutional Counter-Trend Layout Motivation: From the perspectives of funding costs and chip concentration, institutions expanding their positions during sharp declines are, on one hand, taking advantage of prices depressed by passive selling and forced liquidations to dilute long-term holding costs; on the other hand, they are also concentrating chips to enhance their bargaining power in future market games. Compared to retail funds that primarily focus on short-term profits and are prone to emotional decision-making, these funds pay more attention to the risk-return structure over months or even years, rather than panicking and exiting in sync with market sentiment.
Strategy Whales and XAUT Expansion: Hidden Support Points for Long-Term Funds
● Strategy Inc.'s "Bitcoin Treasury": Almost simultaneously with the price shock, Strategy Inc. released its financial report for the fourth quarter and the entire fiscal year of 2025, showing that it holds 713,502 BTC. Roughly estimating with the current coin price, this holding corresponds to a total market value reaching "sovereign-level" scale, making its role in the market closer to a de facto "Bitcoin treasury" rather than a traditional single company asset allocation. Such a scale of long-term holding constitutes an important confidence pillar for the market regarding Bitcoin's medium to long-term value.
● Massive Holdings and Price Bottom Imagination: Strategy Inc. continues to maintain or even increase such a large Bitcoin position, sending two key signals to the market: first, large institutions' long-term logic regarding Bitcoin as a "reserve asset" has not changed due to short-term fluctuations; second, when prices significantly retrace, the market naturally associates the potential absorption capacity of such "treasury-level holders," thereby elevating the emotional perception of the medium to long-term bottom range and weakening the influence of extreme narratives like "zero panic."
● Tether's Investment in Gold.com and XAUT: In a broader digital asset ecosystem context, Tether acquired approximately 12% equity in Gold.com for about $150 million to expand the distribution channels of XAUT. This transaction is not centered around short-term price fluctuations of a single coin but aims to bridge traditional precious metal channels with on-chain assets through equity investment, constructing a cross-market distribution network around gold and crypto assets, representing a typical structural and long-term layout.
● Long-Term Layout's "Anchoring" Effect on Shocks: Whether it is Strategy Inc.'s large-scale Bitcoin holdings or Tether's ecological expansion around XAUT, they essentially provide a value coordinate system that transcends the 24-hour candlestick for crypto assets. When short-term leverage and intraday trading create severe shocks in prices, holding institutions and ecological investments act as "slow variables," providing cognitive anchors and value references for the market, making it easier to reprice around the costs and strategic intentions of these deep-pocketed funds even when prices experience momentary imbalances.
Washington's Criticism and EU Petition: Regulatory Noise Suppressing Risk Appetite
● Strong Statements from the U.S. Treasury Secretary: Reports indicate that U.S. Treasury Secretary Scott Bessen publicly criticized cryptocurrency industry insiders, accusing them of "hindering regulatory progress" during the legislative process. Such negative rhetoric from high-level officials directly impacts market expectations regarding the future regulatory environment, leading funds to prefer reducing risk exposure when facing high-volatility assets, especially during phases where prices have already shown significant corrections, often amplifying panic and wait-and-see sentiment.
● The Game of the EU DLT Pilot Regime: At the same time, several tokenization companies in Europe jointly wrote to EU legislators, requesting modifications to the DLT Pilot Regime to lower compliance thresholds and relax business constraints. This action reflects the industry's desire for greater innovation space within the regulatory framework, while also indicating that the current compliance path faces "not grounded enough" practical resistance in implementation, and the adjustment between industry and regulation is far from complete.
● The Dual Amplification Effect of Regulatory Uncertainty: During rapid price declines, negative news regarding regulatory uncertainty can combine with paper losses, becoming the "last straw" that crushes some investors' confidence, accelerating sell-offs and position reductions; while when institutions choose to accumulate and attempt to lay low, this ambiguity and potential tightening risk at the policy level can also manifest as "discounts" in valuations and position control, making it difficult for the market to quickly return to a high-risk appetite state.
● Background Variables Rather Than Direct Triggers: It is important to clarify that there is currently no evidence showing that the aforementioned regulatory and discourse events are the direct triggers for this dramatic drop within 24 hours. A more reasonable understanding is that they constitute "background noise" and sources of risk premium in the mid-term environment, setting a cautious tone for the overall market. When technical and leverage structures show vulnerabilities, the cumulative impact of these policies and discourses can amplify price fluctuations on an emotional level, but they are not a single "trigger."
Retail Fear and Institutional Greed: Misalignment of Funding Behavior
● Differentiation in Behavior Patterns Among Different Investors: From a behavioral finance perspective, retail investors are more likely to exhibit behaviors such as stop-loss, passive liquidation, and selective "playing dead" observation during short-term declines, with decision-making heavily reliant on short-term price fluctuations and social media sentiment. In contrast, institutional funds tend to buy in batches within preset retracement ranges based on established allocation frameworks, prioritizing increasing positions in Bitcoin, Ethereum, and other high-certainty assets, using time and cost advantages to hedge against short-term volatility. This rhythm difference constitutes a superficial contrast of "fear and greed."
● Technical "Sniping Zone" Rather Than Trend End: Considering Bitcoin's 15% drop and the subsequent breaches of integer levels and previous support zones by ETH, BNB, and SOL, it can be seen that multiple assets slid into a series of psychological and technical sensitive zones at the same time. For some technical funds, these positions are more like high-cost-performance zones for "sniping chips" using liquidity vacuums, rather than signals confirming the end of long-term upward trends. This also explains why institutional and large holders' counter-trend absorption occurs simultaneously when panic selling emerges.
● Reflexivity and "Fear of Missing Out": Large on-chain buy orders, institutional address accumulation, and public disclosures of holdings like those from Strategy Inc. can create significant reflexivity on the emotional side. When retail investors realize that the chips they sold in panic are being absorbed by larger funds, and prices do not continue to collapse but even show signs of recovery, sentiment often shifts rapidly from "fear of falling" to "fear of missing out," driving subsequent chasing and further emotional amplification. This switch from panic to missing out itself exacerbates the market's high volatility characteristics.
● Data-Driven Multi-Cycle Judgment Framework: In a high-volatility environment, establishing a data judgment framework across multiple cycles is particularly crucial: in the short term, focus on volatility indicators and forced liquidation scales to determine whether extreme emotional and leverage zones have been entered; in the medium term, observe changes in institutional holdings and entry cost ranges to assess the risk appetite and potential support of major funds; in the long term, return to compliance progress, macro environment, and ecological construction to judge whether assets still possess cross-cycle allocation value. Using these three perspectives instead of a single candlestick or emotional fragment is likely to maintain relative clarity between the narratives of "panic and bottom-fishing."
Before the Next Shock Arrives: Three Sets of Data Ordinary People Should Learn to Watch
This severe fluctuation has released at least three key signals: first, Bitcoin's drop of over 15% within 24 hours, alongside Ethereum falling below $1,800, BNB dropping below $600, and SOL falling below $70, indicates a systemic deep decline of major coins occurring within the same window; second, data such as Equation founder Vida's purchase of approximately $8 million for 128.28 BTC, "7 Siblings" increasing their holdings by 17,757.77 ETH, and Strategy Inc. holding 713,502 BTC constitute direct evidence of institutions and large holders buying against the trend during the decline; third, the strong statements from the U.S. Treasury Secretary and the game surrounding the EU DLT Pilot Regime continue to exert pressure on sentiment, forming a backdrop of mid-term risk premium.
For traders, a direct insight is that during a crash, the priority should be to track large on-chain transfers and institutional holding disclosures as hard data, as well as contract liquidations and volatility indicators, rather than scattered emotional snippets or unverified news screenshots. At the same time, for fine data such as "BTC touching the $62,719–$63,631 range," which is still in a pending verification state, one should remain sufficiently cautious and not use it as precise technical points or trading decision anchors, developing a habit of multi-source cross-verification and data tiered trust.
Looking ahead to the mid to short term, the high volatility characteristics of the crypto market are likely to persist: on one hand, long-term funds like Strategy Inc. and Tether are continuously deepening their exposure through holdings and ecological investments, raising the mid to long-term value baseline; on the other hand, there remains uncertainty in the regulatory paths in the U.S. and Europe, applying continuous discounts to valuations. In the coming months, the price range of Bitcoin and major coins is likely to oscillate between the "bottom imagination brought by institutional accumulation" and the "valuation suppression from elevated policy risks," with the risk-return ratio increasingly depending on whether investors can maintain a data-centric multi-cycle judgment framework amid severe emotional fluctuations.
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