Key Points:
- Bitcoin regained some ground, rising to over $67,000 on Friday.
- Thursday’s crash was the largest since the FTX collapse three years ago.
- Over $2.1 billion in crypto bets were liquidated in 24 hours. Strategy Inc. reported a $12.4 billion loss due to the price drop.
- Analysts warn that failing to hold $60,000 could lead to further falls.
Bitcoin managed to claw back some value on Friday following a brutal market meltdown the day before. The crash was the most severe the cryptocurrency sector has seen since the FTX exchange collapsed more than three years ago.
On Thursday, the world’s largest cryptocurrency plummeted by 14%, pushing its value down more than 50% from its peak last October. However, buyers stepped in on Friday. Bitcoin rose about 7.2% to reach $67,623. Earlier in the session, the price nearly dipped below $60,000 for the first time since late 2024.
Smaller tokens also joined the recovery. Ether climbed 5.1% and Solana rose about 4.5%, bouncing back after a steep double-digit drop. This rally is crucial because Bitcoin currently makes up nearly 60% of the entire $2.3 trillion crypto market.
Experts believe this crash wasn’t caused by a fundamental flaw in Bitcoin itself. Instead, it was driven by hedge funds and traders hurriedly selling off “leveraged” bets—trading with borrowed money. Evgeny Gokhberg of Re7 Capital noted that the selling seemed structural, caused by panic and forced selling rather than specific bad news about the asset.
Despite the bounce, the market remains incredibly risky. A key index measuring expected price swings nearly doubled from 57% to over 97% on Thursday. In just 24 hours, trading platforms liquidated about $2.1 billion in bullish bets. Pratik Kala from Apollo Crypto described the situation as a “blood on the streets” moment, which encouraged some investors to buy the dip.
Big corporate holders felt the pain immediately. Michael Saylor’s Strategy Inc. confirmed a net loss of $12.4 billion for the fourth quarter, caused directly by the drop in the value of its Bitcoin hoard. Despite the loss, the company’s stock price jumped about 10% on Friday as the crypto market stabilized.
Traders are now watching the charts closely. Damien Loh from Ericsenz Capital says there is strong support at $60,000, but warned investors not to expect a quick recovery.
