Bitcoin’s Slide Deepens Amid ETF Filings and Economic Uncertainty

NEW YORK (Azat TV) – Bitcoin’s value has plunged to a 15-month low, falling to $67,245 as of February 5, 2026, marking a dramatic 46% decline from its record high of $126,210.50 reached on October 6, 2025. This significant downturn is unfolding amidst a complex backdrop of macroeconomic pressures, accelerated market deleveraging, and, paradoxically, a landmark move by major financial institutions like Morgan Stanley to launch their own cryptocurrency investment products.

The current slide represents Bitcoin’s longest losing streak since 2018, with the digital asset shedding nearly 14% of its value in 2026 alone, according to sources including Coinbase. This sharp correction has triggered widespread concern among investors, even as traditional financial giants continue to integrate digital assets into their mainstream offerings.

Bitcoin’s Tumultuous Trajectory

After experiencing a robust rally throughout much of 2024 and 2025, buoyed by institutional investment and perceived crypto-friendly policies from the US government, Bitcoin hit its all-time high in early October 2025. However, this peak was swiftly followed by a steep decline that intensified through November and December, carrying into the new year. By January 6, 2026, the price had fallen to $93,653, and the slide continued aggressively, breaking below the critical $70,000 mark by early February.

The optimism surrounding digital assets under President Donald Trump’s administration, which saw Bitcoin prices climb for nearly a year after his November 2024 election, has largely dissipated. Even Trump-related crypto ventures have seen substantial losses; for instance, American Bitcoin, in which Eric Trump and Donald Trump Jr. hold stakes, has fallen over 80% since October 7, 2025. Similarly, the World Liberty Financial token ($WLFI) and the meme coin $TRUMP have seen their market values significantly diminish, reflecting broader market sentiment.

Macroeconomic Headwinds and Bitcoin’s Decline

Industry analysts, including crypto exchange Binance, point to a confluence of macroeconomic factors for the sustained pressure on Bitcoin. These include fears of interest rate hikes from the Bank of Japan, hawkish tones from other central banks globally, and a dense U.S. data slate. Additionally, the end of corporate buybacks and a year-end ‘quadruple witching’ in November contributed to thinner liquidity and increased downside hedging, exacerbating the sell-off.

Beyond these, the market is experiencing a significant deleveraging event. As observed by Goldsilver.com, Bitcoin’s recent drop below $70,000 was not primarily driven by fresh negative news but by ‘leverage coming out of the system.’ Falling prices triggered margin calls and automatic liquidations, creating a self-reinforcing downward spiral. The current environment of restrictive interest rates and a lack of ‘easy money’ means investors are less willing to tolerate extreme volatility, a stark contrast to previous bull cycles where ample liquidity cushioned risk assets.

This ‘risk-off’ sentiment is also evident in broader markets, with high-beta assets selling off and silver weakening. Gold, however, has demonstrated relative stability, even making major leaps to an all-time high of over $5,500 per ounce, highlighting its traditional role as a safe haven during periods of uncertainty and reduced leverage.

Institutional Adoption Amid Bitcoin Volatility

Despite Bitcoin’s current struggles, major financial institutions are forging ahead with plans to deepen their involvement in the cryptocurrency space. On January 6, 2026, Morgan Stanley, a prominent US bank, filed an S-1 form with the US Securities and Exchange Commission (SEC) for its own Spot Bitcoin Exchange Traded Fund (ETF), to be known as the Morgan Stanley Bitcoin Trust. This marks the first such move by a major US bank to offer its own in-house spot Bitcoin ETF, a significant development following the SEC’s overhaul of rules for new spot ETFs in the previous year.

This initiative follows Morgan Stanley’s October 2025 expansion of access to its crypto products for clients of all levels, a move later mirrored by Bank of America. These actions signify a broader shift by mainstream financial organizations to move beyond merely facilitating third-party crypto products to offering their own, reflecting a long-term outlook for digital assets. The bank intends to hold Bitcoin directly, without leverage or derivatives, calculating daily benchmark prices based on major exchange activity.

Spot Bitcoin ETF products currently hold $123 billion in total net assets, representing 6.57% of Bitcoin’s total market cap. However, they experienced their largest monthly outflows in November, totaling over $3.5 billion, as flows responded directly to macro-driven risk aversion, as noted by Binance. Conversely, newly listed altcoin ETFs for Solana (SOL), XRP, and Litecoin (LTC) maintained net positive inflows during the same period.

Warnings of a ‘Death Spiral’ for Bitcoin

The intensifying price slide has also reignited warnings from prominent figures such as Michael Burry, the investor famed for shorting the 2008 US housing market. In a recent Substack post, Burry cautioned that further losses for Bitcoin could severely strain the balance sheets of investors heavily invested in crypto, potentially leading to a ‘death spiral.’ He argued that if Bitcoin were to drop below $70,000, the financial industry could incur heavy losses, and a fall below $50,000 could force miners out of business, triggering a catastrophic sell-off.

Burry, who has a long-standing critical view of cryptocurrencies, has previously compared them to the 17th-century tulip mania. While his bearish stance has garnered attention, his track record of predictions since the 2008 crisis has been mixed. His concerns, however, reflect a broader sentiment of caution in a market grappling with high interest rates, slowing growth, and surging layoff plans in the US economy, which recorded the highest January layoff announcements since 2009, according to Challenger, Gray & Christmas.

The current market dynamics present a duality: on one hand, Bitcoin is experiencing severe price pressure driven by macro risk aversion and deleveraging, forcing a re-evaluation of its role as a ‘digital gold’ versus a high-beta risk asset. On the other, the continued push by major financial institutions to launch their own crypto investment products signals an undeniable long-term commitment to integrating digital assets into the mainstream financial system, suggesting that the current volatility may be a turbulent phase in a larger, ongoing adoption cycle.