By Omkar Godbole (All times ET unless otherwise noted)
with bitcoins With a bear market in full swing and the price falling to the lowest level since November 2024, its central argument, a strict supply limit of 21 million, faces new skepticism.
Some observers say alternative investment vehicles like ETFs, cash-settled futures and options, and other services like loans from prime brokerages have diluted that scarcity appeal. These tools allow investors to access bitcoins without owning the actual item, creating a “synthetic supply” that floods the market.
“Once supply can be synthetically manufactured, the asset is no longer scarce, and once scarcity disappears, the price becomes a game of derivatives, not a supply and demand market. This is exactly what has happened to Bitcoin,” veteran analyst and writer for The Kendall Report, Bob Kendall, wrote on X.
Gold, silver, oil and stocks underwent a similar structural shift with the debut 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 gross scarcity.
This is also why investors should be careful with on-chain metrics like “illiquid supply percentage,” because they do not take into account the massive “paper supply” of ETFs and futures that dilute the 21 million limit.
In the market, bitcoin lost even more ground, falling below $70,000 for the first time in more than a year.
According to veteran chart analyst Peter Brandt, the sell-off has all the hallmarks of a campaign sale or a coordinated sell-off by institutions and large traders rather than a retail capitulation. Brandt is not sure at what level or when the decline will stop.
Most observers expect a drop to below $60,000, while companies like Stifel fear a deeper drop to $38,000, given the growing correlation with technology stocks, which have also taken a beating lately.
Hyperliquid’s HYPE remains the only consistent stash. The token is up 11% on the year, while BTC is down almost 19%. Another interesting token is TRX, which is down just 2%, possibly outperforming the broader market, thanks to dip buying by treasury firm Tron Inc.
In traditional markets, Wall Street’s so-called fear gauge, the VIX index, is reaching January highs again above 20:00, indicating risk aversion. US Treasury market action suggests expectations of a tighter Fed balance sheet. Stay alert!
Read more: For an analysis of current activity in altcoins and derivatives, see Crypto Markets Today
What to watch
For a more complete list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
- Crypto
- February 5: Zilliqa will undergo its hardfork that will allow Cancun.
- Macro
- February 5, 2 pm: Decision on Mexico’s interest rate (previously 7%)
- February 5, 4:30 pm: Fed balance sheet for the period ending February 4
- Earnings (Estimates based on FactSet data)
- February 5: Bullish (BLSH), premarket, $0.15
- February 5: Strategy (MSTR), post-market, -$18.64
- February 5: IREN Limited (IREN), post-market, -$0.18
- Feb 5: CleanSpark (CLSK), post-market, -$0.02
symbolic events
For a more complete list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
- Governance votes and calls
- 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.
- Unlock
- 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 releases
- There are no major releases scheduled.
Conferences
For a more complete list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
Market movements
- BTC is down 1.62% since 4 pm ET on Wednesday to $71,467.00 (24 hours: -6.52%)
- ETH is up 0.24% to $2,130.50 (24 hours: -5.93%)
- CoinDesk 20 is down 1.68% to 2,077.53 (24 hours: -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 rises 0.29% to 97.90
- Gold futures fall 1.22% to $4,890.20
- Silver futures down 7.55% to $78.02
- The Nikkei 225 closed down 0.88% at 53,818.04
- Hang Seng closed up 0.14% at 26,885.24
- The FTSE is down 0.43% at 10,357.59
- The Euro Stoxx 50 falls 0.36% to 5,949.05
- The DJIA closed Wednesday up 0.53% at 49,501.30
- The S&P 500 closed down 0.51% at 6,882.72
- Nasdaq Composite closed down 1.51% at 22,904.58
- S&P/TSX Composite closed up 0.56% at 32,571.55
- The S&P 40 Latin America closed with a fall of 2.89% to 3,653.05
- The 10-year US Treasury rate fell 0.8 basis points to 4.27%
- E-mini S&P 500 futures unchanged at 6,904.75
- E-mini Nasdaq-100 futures rise 0.14% to 25,033.50
- E-mini Dow Jones Industrial Average index futures down 0.25% to 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 priced in gold: 14.6 oz.
- BTC market capitalization against gold: 4.77%
Technical analysis
- The chart shows the daily price variations in the HYPE token of the Hyperliquid decentralized exchange.
- HYPE price has broken above the trend line that characterizes the decline from September highs.
- The breakout indicates that the path of least resistance is to the higher side and shifts the focus towards the $50 resistance.
Crypto Stocks
- Coinbase Global (COIN): closed on Wednesday at $168.62 (-6.14%), -1.51% to $166.07 in the previous 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
- Bullish (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): closed at $14.14 (-7.82%), -1.34% at $13.95
- Core Scientific (CORZ): closed at $16.15 (-8.96%), +0.37% at $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 treasury 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 Flows
BTC Spot ETF
- Daily net flows: -$544.9 million
- Accumulated net flows: $54.73 billion
- Total BTC holdings ~1.28 million
ETH Spot ETF
- Daily net flows: -$79.4 million
- Accumulated net flows: 11,940 million dollars
- Total ETH holdings ~5.92 million
Source: Farside Investors
while you were sleeping
Miners are coming under pressure as Bitcoin’s $70,000 price fails to cover $87,000 production costs (CoinDesk): Bitcoin is now approximately 20% below its estimated average production cost, increasing financial pressure on the entire 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 after talks between China and the United States, which will also sit down with Iran.
Trillion-Dollar Tech Demise Traps Every Stock in AI’s Path (Bloomberg): Hundreds of billions of dollars were wiped from the value of stocks, bonds and loans of companies large and small across Silicon Valley, with software stocks at the epicenter.
