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Bitcoin traded for $68,674.29 on Monday morning, down 2.28% from its price a week ago of $70,279.32. The decline came despite U.S. markets being closed for Washington’s Birthday today. For context, the S&P 500 fell 1.28% over the past week, while the Nasdaq dropped 1.27%.
The Week’s Volatility Story
Bitcoin’s real drama unfolded Friday. On February 13, the cryptocurrency plunged to $65,799.71, its lowest point since early February, before staging a 3.93% recovery to $68,812. The selloff wasn’t isolated. News reports suggested a $6.9 billion crypto liquidation event may have preceded the drop, with Trump-linked World Liberty Financial (WLFI) showing stress signals five hours before the broader market crash.
Polymarket traders had been pricing in downside risk all month. Prediction markets for Bitcoin hitting specific price levels showed the $60,000 threshold being breached on February 6, with that market resolving at 99.9% certainty. By week’s end, the crowd had recalibrated: the probability of Bitcoin reaching $85,000 in February stood at just 5%, down from earlier optimism.
This cautious sentiment among prediction market traders aligns with broader institutional risk management themes we explored in today’s Daily Profit newsletter, particularly around AI-driven market volatility and defensive positioning.
Corporate Bitcoin Holders Under Pressure
Strategy (NASDAQ:MSTR)’s $50 billion Bitcoin stash became a focal point as the company announced plans to convert $6 billion in bond debt to equity. Management claimed it could survive an 88% Bitcoin crash to $8,000, a defensive posture that raised eyebrows about near-term volatility expectations. Meanwhile, Metaplanet reported $40 million in operating profit but still recorded a $619 million net loss due to mark-to-market accounting on its Bitcoin holdings.
The institutional narrative wasn’t uniformly bearish. Coinbase (NASDAQ:COIN | COIN Price Prediction) CEO Brian Armstrong noted that retail users were steadily purchasing Bitcoin and Ethereum during the dips, displaying what he called “diamond hands.” Bitcoin ETFs saw $15.2 million in net inflows on Friday, suggesting institutional appetite remained intact despite the weekly decline.
What Drove the Weakness
Beyond technical liquidations, two narratives dominated crypto headlines. First, concerns about quantum computing’s threat to Bitcoin resurfaced. Venture capitalist Nic Carter warned that “Bitcoin developers must address the quantum risks to Bitcoin fast to avoid a successful corporate takeover.” Analyst Willy Woo suggested markets were beginning to price in this risk, putting 4 million “lost” BTC into question.
Second, Bitcoin is tracking toward its worst quarter since 2018, down 22.58% year-to-date through February 16. This would mark the first time Bitcoin has closed both January and February in the red, a psychological headwind for momentum-driven traders. Crypto funds saw $173 million in outflows last week as capital rotated into altcoins like XRP and Solana, which outperformed Bitcoin’s weekly loss.
The week ahead hinges on whether Bitcoin can reclaim the $70,000 level it briefly tested on February 15. With leverage building in futures markets and prediction markets pricing in continued consolidation, any catalyst, macro or crypto-native, could drive the next directional move.
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