On February 1, the Bitcoin market experienced significant volatility, with prices briefly falling below $75,000—more than a 30% drop from its all-time high.
According to data from strategy analytics firm CryptoQuant, Bitcoin’s realized market cap has essentially plateaued, indicating that new capital has stopped flowing into the market. Notably, despite the sharp market correction, companies like Strategy have not changed their Bitcoin investment strategies.
01 Market Turbulence
The crypto market is currently experiencing intense price swings. On February 2, 2026, the Bitcoin price briefly dipped below $75,000, ultimately closing at $76,524.86. This decline marks a new low not seen since April 2025.
In just 24 hours, the total cryptocurrency market capitalization evaporated by approximately $111 billion, with about $1.6 billion in leveraged positions liquidated—primarily in Bitcoin and Ethereum.
Compared to the historical high of $126,100 in October 2025, Bitcoin has now dropped by roughly 38%. It’s not just Bitcoin; major tokens like Ethereum and Solana have also seen steep declines, reflecting broad market weakness.
02 Corporate Strategies
Amid widespread market concerns, Strategy—the largest publicly traded Bitcoin holder—currently faces over $900 million in unrealized losses on its 712,647 Bitcoin holdings.
Surprisingly, despite these substantial paper losses, Strategy has not altered its approach. In fact, the company has announced a 25 basis point increase in the February dividend rate for its perpetual preferred shares (STRC), raising it to 11.25%.
Michael Saylor stated that this move will enable the company to raise additional capital through stock issuance to further increase its Bitcoin holdings. This clearly demonstrates that, even in the face of significant unrealized losses, the company’s long-term confidence in Bitcoin remains unwavering.
03 The "Digital Gold" Narrative Under Pressure
Bitcoin has long positioned itself as "digital gold," but recent market performance has challenged this narrative. While gold surged to a historic high of $5,600 per ounce, Bitcoin’s price continued to decline.
Data shows that Bitcoin’s 30-day rolling correlation with the Nasdaq 100 Index reached 0.80 in January 2026, the highest level in nearly four years.
This suggests that Bitcoin is behaving more like a high-risk tech stock rather than a traditional safe-haven asset.
During the latest period of geopolitical tensions, Bitcoin fell by 6.6%, while gold rose by 8.6%, further highlighting Bitcoin’s shortcomings as a hedge.
04 Shifting Market Structure
The approval of spot Bitcoin ETFs in the US in January 2024 was hailed by many as a milestone for crypto’s legitimacy, but it may have unintentionally altered Bitcoin’s role in the market.
Research indicates that ETF approval has changed the correlation pattern between Bitcoin and the S&P 500, making Bitcoin behave more like a traditional risk asset rather than an independent hedge.
Within the ETF framework, capital flows that might have gone to gold are now moving toward Bitcoin, but largely for speculative reasons rather than hedging purposes.
Recently, US spot Bitcoin ETFs saw four consecutive days of net outflows totaling $1.62 billion, signaling that institutional investors are reducing their exposure to the crypto market.
05 The Liquidity Challenge
Another critical issue for the Bitcoin market is declining liquidity. Early Bitcoin holders, who benefited from months of aggressive buying by spot Bitcoin ETFs and Strategy, are now starting to take profits.
On-chain analysis reveals that "old coins" continue to flow into exchanges, indicating persistent selling pressure. This "overhang from sellers" stands in stark contrast to the gold market, where central banks’ ongoing purchases provide strong structural support for gold prices.
Market data shows that spot trading volumes for Bitcoin and altcoins have fallen to their lowest levels since November 2023, creating an increasingly thin liquidity environment.
Analyst Willy Woo describes the current market as a "ghost town," noting that Bitcoin’s mempool and transaction fees have dropped to historic lows, reflecting a sharp decline in on-chain activity.
06 Institutional Holders’ Response Strategies
In response to market challenges, major Bitcoin-holding companies are adopting several strategies:
Raising dividends to fund purchases: Strategy increased the dividend rate for its perpetual preferred shares (STRC), providing the company with more capital to buy additional Bitcoin.
Sticking to long-term holding strategies: Despite unrealized losses, companies like Strategy show no intention of selling their Bitcoin. Data from Chaincode Labs indicates that the company continues to accumulate Bitcoin.
Exchanges are also taking action: Bitget CEO Gracy Chen stated that the exchange continued to increase its Bitcoin holdings from January 2025 to January 2026, with the platform’s BTC balance "almost only going up." As a leading cryptocurrency exchange, Gate also offers investors a secure and reliable environment for trading Bitcoin.
07 How Investors Can Navigate the Current Landscape
For individual investors, a cautious but not overly pessimistic approach is advisable in the current market environment:
Focus on long-term trends: CryptoQuant CEO Ki Young Ju points out that unless major holders like Strategy begin selling Bitcoin, a deep cyclical drop of 70% is unlikely. The current decline is more likely to resolve through a prolonged period of sideways consolidation rather than a rapid rebound.
Maintain investment discipline: In today’s market, sticking to a disciplined investment strategy is especially important. Gate suggests that investors can mitigate volatility by using regular, fixed-amount investing.
Pay attention to risk management: Leveraged trading is particularly risky in this environment. With about $1.6 billion in leveraged positions liquidated in the past 24 hours, investors are reminded to use leverage cautiously.
Bear markets are more likely to result in extended consolidation phases. When gold and silver experience sharp corrections, Bitcoin’s response is often limited, which dampens expectations for crypto as an overflow hedge.
Market data shows that Bitcoin’s price briefly fell below $75,000, and Strategy’s Bitcoin holdings now face over $900 million in unrealized losses. Yet Saylor seems to be looking beyond current price swings, focusing on raising preferred share dividends and planning to raise more capital to increase Bitcoin holdings.
In the darkest hour before dawn, publicly traded Bitcoin companies have chosen to stand their ground.
