Why Bitcoin is Crashing Today: Will It Recover or Fall Further?

Bitcoin Price Crash: Reasons Behind the Plunge & What’s Next For $BTC?

Bitcoin Price Plummets 10% After Failing $100K — Will BTC Hit $81K?

Following its failure to regain the coveted $100,000 mark, Bitcoin (BTC) suffered a severe setback on February 21, falling 10%. At $88,000, the price fell to a level not seen since mid-November 2024. Investors were alarmed by this precipitous drop, and the ByBit hack made matters worse. However, the main offenders? Overuse of leverage and an increase in liquidations.

Investor Sentiment Tanks — Fear and Greed Index Hits "Extreme Fear"

The sharp decline in the market shook investor mood. As the Fear and Greed Index fell to 25, the market was solidly in "Extreme Fear" zone. Due to increased volatility and panic selling waves, this sharp decline highlights how uneasy investors have grown.

Mass Liquidations Total $1.34 Billion Amid Market Chaos

The fallout was brutal. Over the past 24 hours, a staggering 366,734 traders saw their positions liquidated, leading to losses totaling $1.34 billion, according to Coinglass. The largest single liquidation? A whopping $20.8 million BTC/USDT position on Binance, completely wiped out. This tidal wave of liquidations highlights the intense risk and volatility plaguing the market.

Bitcoin Network Activity Slows as Prices Drop Below $89K

As Bitcoin slipped below $89,000, approximately 12% of BTC addresses sank into unrealized losses — the highest percentage since October 2024, as reported by IntoTheBlock. This underscores the mounting pressure on investors caught in this downturn.

Moreover, network activity has visibly slowed. The daily creation of new Bitcoin addresses has dwindled to 240,534 — its lowest level since July 2024. This decline signals reduced user engagement and participation within the network.

Whale Activity: Profit-Taking During Market Downturn

Meanwhile, whale movements have stirred up fresh speculation. A long-dormant Bitcoin whale, inactive for three years, suddenly moved 200 BTC (worth $18.4 million) to Binance. This whale originally bought BTC at an average price of $30,873 in 2022, locking in an eye-popping 198% profit. The timing of this massive transfer coincided with a 4.5% drop in BTC’s price, suggesting a calculated exit amid the bearish downturn.

Technical Analysis: Will BTC Rebound or Drop to $81K?

Bitcoin’s price action looks grim. Crypto analyst Ali Marzante warns that BTC has broken below its parallel channel, increasing the likelihood of a further drop to $81,000. Several technical indicators echo this bearish outlook:

• BTC has breached its descending channel.

• Currently, the price is below the 20, 50, and 100-day short-term moving averages.

• The crucial support level is the 200-day SMA around $81,629 today.

The price of Bitcoin is currently $88,657. Regaining the $91,000 support zone is necessary to prevent additional declines. BTC may return to the $96,000–$100,000 region if a daily close above $92,500 rekindles bullish momentum.

A second wave of panic selling, however, might occur if significant support levels are not upheld, bringing Bitcoin closer to the 200-day EMA and possibly above the $81,000 barrier.

Conclusion: Bitcoin’s Next Move — Rebound or Collapse?

Right now, Bitcoin is at a turning point. A clear break over $92,500 would show a positive bounce; a drop below $81,000 would show a deepening bearish trend. Investors should get ready for turbulent times ahead since volatility is great and the market attitude is about to crash. Will Bitcoin come back, or will more pain be ahead?