Bitcoin clawed back above $65,000 on Friday, but the rebound did little to calm markets after a brutal selloff left the world’s largest cryptocurrency heading for its worst weekly drop since late 2022.
The sharp moves come as a global rout in technology stocks and other risk assets forces investors to unwind crowded bets, exposing how tightly crypto has become entangled with broader market stress rather than operating as a safe haven.
Bitcoin was last trading near $65,900 after tumbling as low as $60,000 earlier in the week. Even with Friday’s bounce, the token is down nearly 14% for the week, a collapse not seen since the aftermath of the 2022 crypto crisis that wiped out major firms and billions in investor wealth.
The wider damage is far deeper. The global crypto market has shed around $2 trillion in value since October, with more than $1 trillion erased in just the past month, according to CoinGecko data — a pace of losses that has reignited fears of forced liquidations and systemic stress.
Analysts say the slide reflects a rapid unwinding of leveraged positions as confidence fades. Bitcoin’s long-standing correlation with tech stocks and AI-driven risk trades has turned from a tailwind into a liability as investors rush to cut exposure.
Ether followed the same pattern, rebounding Friday but still heading for a near-16% weekly loss and a steep year-to-date decline, underscoring how broad the retreat has become across digital assets.
Adding to the pressure, analysts at Deutsche Bank said U.S. spot bitcoin ETFs saw more than $3 billion in outflows in January, extending months of withdrawals and signaling that institutional money is continuing to exit rather than step in to stabilize prices.
While some traders see the move back above $65,000 as a pause in the selloff, market strategists warned that the recovery remains fragile. With tech stocks under pressure, liquidity tightening, and leverage being pulled back across asset classes, crypto markets remain exposed to another sharp leg lower if risk sentiment deteriorates again.
