Bitcoin's Sharp Decline: Market Analysis Amid ETF Outflows
- Bitcoin declines due to ETF outflows and geopolitical tensions.
- Price down 7-8% amid heavy liquidations.
- Capital rotates to gold and silver markets.
Bitcoin’s price declined sharply to $71,000-$76,200 on February 5, 2026, due to record ETF outflows, geopolitical tensions, and significant long liquidations.
The price drop underscores Bitcoin’s vulnerability to macroeconomic shocks, highlighting a shift in investor sentiment towards traditional safe havens amid rising volatility and risk aversion.
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Bitcoin’s Sharp Decline
The Bitcoin (BTC) price fell sharply to between $71,000 and $76,200 as of early February 5, 2026. This drop follows a low near $69,000 to $72,877, after ETF outflows topped $1.1 billion weekly. ChmielDk’s X Profile
Key institutional players exhibited derisking behaviors, particularly via spot Bitcoin ETFs, from which 92% of the $1.137 billion outflows originated. This action signaled cautious sentiment among large holders.
The decline in Bitcoin price caused notable market effects, with broader market cap shedding $467.6 billion since January 29. The ripple effect impacted related cryptocurrencies like Ethereum and Solana.
The persistent decline affected market sentiment, leading to liquidity adjustments. Geopolitical tensions involving US-Iran escalation and rare earth tariffs added to the volatile climate.
MEXC Official Account Analysts are closely observing the correlation between Bitcoin and equities, as well as capital flow to gold and silver. Market participants are adjusting strategies, evident in options trading activities focused on puts at $88k/$85k.
Historical data shows similar selloffs were linked to previous ETF movements and geopolitical events. This emphasizes a trend where financial shifts occur amid geopolitical instability. Insights revealed a growing decoupling from the typical ‘safe haven’ narrative.
“The psychological support at $80,000 has been obliterated. We are seeing a complete decoupling from the ‘safe haven’ thesis.” — Unnamed Senior Analyst, Unnamed Digital Asset Fund
