Bitcoin Prices Drop to $92,000 Amid $785 Million Liquidation of Long Bets

Summary: Bitcoin's price experienced a decline as $785 million worth of long positions were liquidated, halting a recent rally that was heavily driven by derivatives trading. This downturn was exacerbated by new tariffs announced by the U.S. government, which contributed to a shaky market environment.

Key Takeaways

Bitcoin's price fell to $92,000 due to significant liquidations of long positions worth $785 million.
The broader crypto market showed declines, with notable drops in altcoins like Solana and SUI.
The liquidity risks in the futures market leave Bitcoin vulnerable to sudden price fluctuations.
Analysts highlight that demand for Bitcoin on spot markets remains subdued, affecting overall market stability.
Cautions persist as leverage dynamics continue to dominate market trends.

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Bitcoin Declines as Bullish Momentum Fades

Bitcoin started the week under tension, experiencing a setback as a wave of liquidations abruptly halted a recent surge driven primarily by derivatives activity. This retreat was further influenced by new macroeconomic challenges, especially following U.S. President Trump’s announcement of tariffs on eight European countries. These tariffs, starting at 10% on February 1, 2026, and escalating to 25% by June 1, are slated to remain in place until the U.S. secures an agreement to purchase Greenland.

Crypto Liquidation Last 24 Hours

The selling pressure didn’t solely impact Bitcoin. Other cryptocurrencies also saw declines, with Solana dropping by 6.5%, SUI falling by 12%, and ZCash slipping by 7%. These synchronized movements underscore a market significantly influenced by Bitcoin's trajectory, as altcoins followed suit in response to declining sentiment.

Market Weakness Revealed by Thin Liquidity

According to Glassnode's weekly report, Bitcoin's recent rise toward $96,000 was primarily dependent on derivatives trading, with limited ongoing accumulation in the spot market. The firm also highlighted that thin liquidity in futures markets makes the cryptocurrency susceptible to sudden price reversals. As leverage-driven demand decreases, Bitcoin's price can quickly lose its path. There exists a supply zone that has been established by long-term holders who bought in during previous market cycles, which has repeatedly obstructed recent recovery efforts.

Uncertainty Rears Its Head

In light of these developments, CryptoQuant expressed a cautious perspective, characterizing the recent advance since late November as a corrective phase rather than an indication of a confirmed trend reversal. Bitcoin continues to trade below its 365-day moving average of approximately $101,000, a key threshold that historically delineates bullish from bearish market conditions. While there have been minor improvements, spot demand is still contracting, and U.S. spot Bitcoin ETF inflows remain low.

Signs of Stability Amid Limited Momentum

Despite the prevailing uncertainty, some early signs of stabilization have surfaced. Glassnode observed that the distribution of Bitcoin among long-term holders has slowed down compared to late 2025, which indicates a potential decrease in selling pressure from seasoned investors. Buying interest has strengthened on platforms linked to Binance, whereas selling activity on Coinbase appears to be easing. Nevertheless, these changes have not yet led to a consistent rise in prices.

The options market reflects this cautious sentiment, as noted by Glassnode, which reports that implied volatility levels remain low. However, contracts with longer expiration dates are still pricing in downside risk, suggesting continued apprehension in the market.

Leverage Dynamics Define Current Risks

Overall, analysts agree that the market is still heavily influenced by leverage dynamics. Both Glassnode and CryptoQuant emphasize the importance of liquidity shifts as a significant factor affecting price movements. Without a substantial revival in spot demand, it is likely that the risks of volatility will remain high. Until that demand reemerges, Bitcoin is expected to be reactive, with price changes driven more by market positioning than fundamental factors.

Disclaimer: This article is intended for informational purposes only and should not be interpreted as financial advice. The opinions expressed herein may reflect the author's personal views and do not necessarily represent the views of The Crypto Basic. Readers are encouraged to conduct their own research before making investment choices. The Crypto Basic is not liable for any financial losses.