Bitcoin Drops From $90,000 To $70,000 In 2 Weeks, But ‘Much Of The Bad News Already Priced In’

by | Feb 9, 2026 | General

Bitcoin (CRYPTO: BTC) has logged its steepest two-week drawdown since June 2022, but Bitwise Chief Investment Officer Matt Hougan says “much of the bad news is already priced in”.

The 6 Crash Factors

Hogan identified six factors driving the crash:

  1. Front-running the four-year cycle: long-term crypto investors sold to avoid the historical pattern of three up years followed by a down year (2014, 2018, 2022, 2026). Hougan estimates these investors sold well over $100 billion of Bitcoin last year.
  2. Attention shifted to AI and metals: retail “attention investors” who drove crypto higher rotated capital into AI stocks and precious metals, partially withdrawing from crypto.
  3. October 10 leverage liquidation: Bitcoin experienced its largest leveraged blowout in history when Trump announced a surprise 100% tariff on Chinese goods after market close on a Friday, forcing traders to use crypto markets to express displeasure.
  4. Hawkish Fed Chair pick: the nomination of Kevin Warsh as Fed Chair on January 30 spooked markets, with Warsh seen as the most hawkish candidate.
  5. Quantum computing fears: rising concern among Bitcoin advocates that the community isn’t addressing quantum computing risks kept some long-term investors on the sidelines.
  6. Macro risk-off sentiment: Bitcoin wasn’t alone. Gold fell 4%, silver tumbled 20%, and tech stocks like Microsoft Palantir and Amazon dropped significantly.

Signs of Exhaustion

On-chain data reveals long-term holders stopped selling aggressively and some are buying.

Open interest on Bitcoin derivatives exchanges fell to 2024 levels. Rate cut expectations are increasing.

Moreover, Sentiment is hovering near historic lows, matching levels that marked crypto bottoms in 2018 and 2022, suggesting the market has already priced in much of the bad news.

Could It Fall Further?

Yes. Previous drawdowns were larger: Bitcoin fell 86% in 2014, 84% in 2018, and 77% in 2022.

Prior downturns lasted 12-13 months, meaning this one could continue.

However, Hougan argues crypto is more mature now, making a 77% drawdown less likely.

This differs from 2022—no signs of forced selling tied to insolvency or broken market infrastructure.

Hougan said crypto bear markets “tend to end in exhaustion, not excitement.”

Potential catalysts include the Clarity Act passing, risk-on market shift, quantum progress, rising rate-cut expectations, and AI-crypto breakthroughs.

The 2018 dip buyer is up roughly 2,000%, while the 2022 buyer is up approximately 300%.

Additionally, Bloomberg’s Eric Balchunas noted Bitcoin has a 100% record of coming back from beatdowns to hit new all-time highs. “Maybe this time is different, but for now it is an indisputable fact.”

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