Bitcoin is experiencing a sharp decline as the price of the token has dropped below the $90,000 mark. As of today, February 25, 2025, the price of the token stands at $89,658 with a dip of 6.1% in the last 24 hours.
This price dip indicates a 17.53% decline from its all-time high of $108,786, as per CoinGecko. This downward spiral of the coin began back in November 2024, and has not been slowing down ever since.
All of this triggered a $1.34 billion in liquidations over 24 hours. This situation has affected over 362,200 traders with $1.24 billion originating just from the liquidation of long positions.
If one looks at the broader market capitalization, it is bleeding red as there has been a dip of 9.2%, indicating that the investors are becoming more cautious due to growing economic concerns.
Fear and Greed Index Indicates Extreme Fear
Simultaneously, the Crypto Fear and Greed Index has plummeted to 25, its lowest reading since September 2024. This signals that there is extreme fear among the investors with majority of them panic selling their crypto assets at the moment.
The dip is a big deal as $90,000 mark is considered to be a strong support level and prices dropping below this level could lead to more selling. The price pattern is similar to what happened in January 2025, where the prices dropped from $106,300 to $90,000 in just 7 days.
Macroeconomic catalysts
The main reason for the current downward spiral of Bitcoin prices is mainly attributed to macroeconomic factors. Strong US economic news has led people to invest in stocks instead of cryptocurrencies.
The Japanese yen on the other hand, is also getting stronger than the US dollar, making people less willing to take risks on Bitcoin.
This entire situation suggests that Bitcoin’s role as “digital gold” is challenged during times of macroeconomic uncertainty, with investors favoring established fiat hedges over cryptographic alternatives.
Institutional vs Retail Response
There is a huge difference on how institutional investors and individuals are reacting to the crypto market currently. While individual investors are selling, institutional investors will make the most of this opportunity and will buy more Bitcoin quietly.
While Bitcoin’s current price action may cause a sense of concern, but institutional accumulations through ETFs suggest that the institutional buyers will use this as a buying opportunity and will make the most out of it.
To get through these difficult times, the investors should give priority to risk management strategies and be on a lookout for macroeconomic changes that influence the market dynamics.
Also Read: SEC May Reconsider Consensys Lawsuit Amid Staking Focus
