Bitcoin Capitulates: $10K Daily Drop Resets Sentiment to FTX-Era Lows
Bitcoin’s $10,000 daily drop triggers $2.7B in liquidations and sends the Fear & Greed Index to 9, its lowest point since the Terra/Luna crisis.
The market didn’t just flinch yesterday; it broke. Bitcoin logged its largest single-day dollar loss in history on Feb. 5, plunging over $10,200 to test $60,000 support. The move obliterated $2.7 billion in leveraged positions and dragged sentiment metrics back to levels not seen since the Terra/Luna collapse of mid-2022.
The Receipt: A Historic Liquidation Event
Data confirms the carnage: Bitcoin slid approximately 14% from a high of $73,000 to lows near $62,800. This wasn’t a slow bleed. It was a cascade. According to market data, 588,000 traders were liquidated in a 24-hour window, with long positions accounting for the vast majority of the damage.
The structural damage is visible on-chain. The Crypto Fear & Greed Index slammed down to 9/100 (“Extreme Fear”) this morning. For context, the index hasn’t registered a single-digit reading since the aftermath of the Terra ecosystem implosion in June 2022. Simultaneously, CoinDesk’s sentiment gauge and the Bitcoin volatility index (BVIV) both spiked to readings synonymous with the FTX exchange collapse, with BVIV touching nearly 100%.
Institutional & Miner Capitulation
Retail panic is loud, but institutional flows are telling the real story. Amid the chaos, Bitcoin miner Marathon Digital (MARA) moved approximately $87 million in BTC to trading desks and exchanges. This suggests miners, squeezed by prices falling below production costs, are selling into strength rather than hodling, adding supply pressure at critical support levels.
“The selloff is broad-based and severe. It has entered its worst three-day stretch since… the FTX crash.”
The Sentiment Divergence
The retail response has shifted from “buy the dip” to survival mode. Viral threads on r/CryptoCurrency have begun openly speculating on exchange solvency, specifically targeting Binance, echoing the paranoia of late 2022. On r/Solana, capitulation is palpable, with users reporting five-figure losses as the token tracked Bitcoin’s descent.
The market now sits at a decisive pivot. Bitcoin has sliced through its 200-week EMA, a technical line in the sand that historically separates bull market corrections from deep bear markets. With volatility at multi-year highs and fear metrics maxed out, the next 48 hours will determine if this is a generation buy signal or the start of a prolonged crypto winter.
