By Omkar Godbole (All times ET unless otherwise noted)
With Bitcoin as the bear market rages and the price has fallen to the lowest since November 2024, its main pitch, a hard cap of 21 million bids, faces new skepticism.
Some observers say alternative investment vehicles like ETFs, cash-settled futures and options, and other services like loans from prime brokers have diluted that scarcity appeal. These tools allow investors to access bitcoin without owning the real thing, thus creating a “synthetic supply” that floods the market.
“Once you can synthetically manufacture supply, the asset is no longer scarce, and once scarcity is gone, price becomes a derivatives game, not a market of supply and demand. This is exactly what happened to Bitcoin,” Bob Kendall, veteran analyst and author of the Kendall Report, wrote on X.
Gold, silver, oil and stocks have experienced a similar structural shift with the launch of alternative investment vehicles, Kendall wrote. In 2023, CoinDesk highlighted how the financialization of BTC creates paper claims that mimic abundance in a market defined by raw scarcity.
This is also why investors should be careful with on-chain metrics like “illiquid supply percentage” because they don’t account for the massive “paper supply” from ETFs and futures that dilute the 21 million cap.
In the market, bitcoin lost even more ground, falling below $70,000 for the first time in over a year.
According to veteran chart analyst Peter Brandt, the sale has all the hallmarks of a campaign sale, or a sale coordinated by institutions and large traders, rather than a capitulation by retailers. Brandt isn’t sure at what level or when the decline will stop.
Most observers expect a decline to below $60,000, while companies like Stifel fear a deeper decline to $38,000, given the strengthening correlation with technology stocks, which have also been under strain of late.
Hyperliquid’s HYPE remains the only consistent hiding place. The token is up 11% for the year, while BTC is down almost 19%. Another interesting token is TRX, which is down just 2%, perhaps outperforming the broader market, thanks to dip buying by treasury company Tron Inc.
In traditional markets, Wall Street’s fear gauge, the VIX, is revisiting January highs above 20.00, signaling risk aversion. U.S. Treasury market action suggests expectations for a smaller Fed balance sheet. Stay vigilant!
Read more: For analysis of current altcoin and derivatives activity, see Crypto Markets Today
What to watch
For a more comprehensive list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
- Cryptocurrency
- February 5: Zilliqa will undergo its hardfork allowing Cancun.
- Macro
- February 5, 2:00 p.m.: Decision on interest rates in Mexico (previously 7%)
- February 5, 4:30 p.m.: Fed balance sheet for the period ending February 4
- Earnings (Estimates based on FactSet data)
- February 5: Bullish (BLSH), pre-market, $0.15
- February 5: Strategy (MSTR), post-market, -$18.64
- February 5: IREN Limited (IREN), post-market, -$0.18
- February 5: CleanSpark (CLSK), post-market, -$0.02
Token Events
For a more comprehensive list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
- Votes and calls on governance
- February 5: PancakeSwap will host an ask me anything (AMA) session with Arbitrum.
- February 5: Olympus will host a community call with a live Q&A session.
- February 5: Aster will host an AMA session with its CEO.
- Unlocks
- February 5: to unlock 5% of its circulating supply worth $31.52 million.
- February 5: to unlock 2.31% of its circulating supply worth $26.46 million.
- Token Launches
- No major launch planned.
Conferences
For a more comprehensive list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
Market movements
- BTC is down 1.62% from 4 p.m. ET Wednesday at $71,467.00 (24 hours: -6.52%)
- ETH is up 0.24% at $2,130.50 (24 hours: -5.93%)
- CoinDesk 20 is down 1.68% at 2,077.53 (24h: -7.15%)
- Ether CESR Composite Staking Rate Up 18 Basis Points to 3.01%
- BTC funding rate is 0.0008% (0.8793% annualized) on Binance
- DXY is up 0.29% at 97.90
- Gold futures are down 1.22% at $4,890.20
- Silver futures are down 7.55% at $78.02
- The Nikkei 225 closed down 0.88% at 53,818.04
- Hang Seng closed 0.14% higher at 26,885.24
- The FTSE is down 0.43% at 10,357.59
- The Euro Stoxx 50 is down 0.36% at 5,949.05
- DJIA closed Wednesday up 0.53% at 49,501.30
- The S&P 500 closed down 0.51% at 6,882.72
- The Nasdaq Composite closed down 1.51% at 22,904.58
- The S&P/TSX Composite Index closed up 0.56% at 32,571.55
- The S&P 40 Latin America closed down 2.89% at 3,653.05
- The 10-year US Treasury yield is down 0.8 bps to 4.27%
- E-mini S&P 500 futures unchanged at 6,904.75
- E-mini Nasdaq-100 futures are up 0.14% at 25,033.50
- E-mini Dow Jones Industrial Average futures are down 0.25% at 49,466.00
Bitcoin Statistics
- BTC dominance: 59.26% (-0.39%)
- Ether-bitcoin ratio: 0.02981 (1.56%)
- Hashrate (seven-day moving average): 913 EH/s
- Hash price (spot): $32.02
- Total fees: 3.22 BTC / $240,320
- CME Futures Open Interest: 114,080 BTC
- BTC valued in gold: 14.6 ounces.
- BTC vs. gold market capitalization: 4.77%
Technical analysis
- The chart shows daily price fluctuations of the HYPE token from decentralized exchange Hype.
- HYPE price has broken above the trendline that characterizes the decline from September highs.
- The breakout indicates that the path of least resistance is upward and focuses on resistance at $50.
Crypto Stocks
- Coinbase Global (COIN): Closed Wednesday at $168.62 (-6.14%), -1.51% at $166.07 in pre-market
- Circle Internet (CRCL): closed at $55.05 (-1.98%), -1.25% at $54.36
- Galaxy Digital (GLXY): closed at $20.16 (-8.28%), -1.49% at $19.86
- Bull (BLSH): closed at $27.20 (-1.59%), -0.51% at $27.06
- MARA Holdings (MARA): closed at $8.28 (-8.51%), -1.81% at $8.13
- Riot Platforms (RIOT): close at $14.14 (-7.82%), -1.34% at $13.95
- Core Scientific (CORZ): closed at $16.15 (-8.96%), +0.37% to $16.21
- CleanSpark (CLSK): closed at $10.22 (-10.04%), -1.47% at $10.07
- CoinShares Valkyrie Bitcoin Miners ETF (WGMI): Closed at $40.29 (-11.06%)
- Exodus Movement (EXOD): closed at $10.70 (+2.20%)
Crypto Cash Companies
- Strategy (MSTR): closed at $129.09 (-3.13%), -3.24% at $124.91
- Strive (ASST): closed at $0.59 (-13.20%), -6.74% at $0.55
- SharpLink Gaming (SBET): closed at $7.08 (-7.57%), -2.54% at $6.90
- Upexi (UPXI): closed at $1.36 (-12.26%), -2.21% at $1.33
- Lite Strategy (LITS): closed at $1.06 (-7.83%)
ETF Feed
Spot BTC ETF
- Daily net flows: -$544.9 million
- Cumulative net flows: $54.73 billion
- Total BTC holdings ~1.28 million
ETH Spot ETF
- Daily net flows: -$79.4 million
- Cumulative net flows: $11.94 billion
- Total ETH holdings ~5.92 million
Source: Farside Investors
While you were sleeping
Miners are squeezed as Bitcoin’s $70,000 price fails to cover $87,000 production costs (CoinDesk): Bitcoin is now about 20% below its estimated average production cost, increasing financial pressure in the crypto mining industry.
Precious metals and oil fall as global tensions ease; copper down (Reuters): Prices of commodities, from silver and gold to crude oil and copper, plunged on Thursday as global tensions eased following talks between China and the United States, which is also expected to sit down with Iran.
Billion-Dollar Tech Wipe Ensnares Every Stock in AI’s Path (Bloomberg): Hundreds of billions of dollars have been wiped from the value of stocks, bonds and loans of companies large and small in Silicon Valley, with software stocks at the epicenter.
