After crashing all week, Bitcoin bottomed last Thursday at $60,000 before a mammoth rally on Friday sent the price up nearly 20% to just under $72,000. This rebound, however, is increasingly looking like a type of “dead cat”.
In mid-morning U.S. trading, bitcoin is once again sharply lower, trading just below $66,000 and down more than 4% in the past 24 hours. Ether and Solana are lower by closer to 5.5% and XRP is down 3.5%.
Rising earlier in the session, U.S. stocks returned to roughly flat that day. Gold and silver are up 0.8% and 3.2% respectively.
Earlier on Wednesday, the US government announced job creation of 130,000 in January, almost double economists’ forecasts. The unemployment rate unexpectedly fell to 4.3%.
This causes interest rate traders to quickly back away from any expectations of an imminent Federal Reserve rate cut. They now put the chance of easing in March at just 6% and the chance of a rate cut in April at 23%, according to CME FedWatch. Before the report, the odds of a decision in March were 21%, and the odds of a decision in April were 52%.
It is questionable whether rate cuts would have pulled crypto out of its bear market. After all, this sharp decline began in 2025, when the Fed eased monetary policy in three consecutive meetings.
Interest decreases
With so many other assets across the world in bull markets while crypto continues to weaken, it appears that investor interest in crypto is fading.
Coinglass reported on Wednesday that open interest in Bitcoin perpetual futures had fallen again and was now 51% below its October 2025 peak, “signaling a significant pullback in trader conviction and leverage.”
“We are seeing an exit movement from cryptocurrencies as investors tire,” an analyst told Bloomberg in an article about South Korean investors abandoning cryptocurrencies as that country’s Kospi stock index hits record highs.
Monthly trading volume on Kospi increased 221% year-over-year last month, the story continues, while trading on crypto exchanges declined by around 65%.
“It’s a disaster,” the analyst said. “Retail trade is exhausted and fleeing to Kospi.”
Crypto Stocks Down Sharply Across the Board
There is no green in the entire crypto-related stock sector. Robinhood (HOOD) is down 12.5% after reporting a sharp decline in fourth-quarter crypto trading revenue. This weighs on Coinbase (COIN), which is down 7% ahead of its earnings report scheduled for Thursday evening.
Strategy (MSTR), the leading Bitcoin treasury company, is down 4.5% and Ethereum treasury giant Bitmine Immersion (BMNR) is down 3.8%.
Circle Financial (CRCL) is down 4.7%, Galaxy Digital (GLXY) is down 3.2%, and Bullish (BLSH) is down 5.3%.
