Bitcoin returns above $70,000, almost recovers all losses from Thursday

Bitcoin surged as much as 13% on Friday, reaching $71,469 (UTC+8), after earlier in the session coming close to falling below the $60,000 mark for the first time since October 2024. However, Bitcoin is still down more than 15% for the week.

Thursday’s plunge was the steepest drop in cryptocurrencies since the collapse of Sam Bankman-Fried’s FTX exchange more than three years ago.

On that day, Bitcoin at one point tumbled over 13%, bringing its cumulative decline from the October peak to over 50%.

Other smaller and less liquid tokens also rebounded. Both Ether and Solana climbed 9% (UTC+8), while XRP soared more than 30% (UTC+8). In the $2.38 trillion crypto market, Bitcoin accounts for nearly 60%.

Evgeny Gokhberg, founder of Re7 Capital, stated that Bitcoin’s pullback from its all-time high appeared to be “driven more by indiscriminate position unwinding than by any clear fundamental catalyst. Market flows suggest that hedge funds may be deleveraging, including pressure around basis trades, which means that this downturn is likely structural rather than fundamentally driven.”

Damien Loh, Chief Investment Officer at Ericsenz Capital, said that Bitcoin’s rebound from $60,000 shows “there is strong support at that level.” However, as market sentiment remains cautious, traders should not “expect a sharp price recovery.”

The Bitcoin Volmex Implied Volatility Index—designed to reflect market expectations for Bitcoin’s volatility over the next 30 days, derived from real-time crypto options prices—soared from 57% (UTC+8) on Thursday to over 97% (UTC+8).

“Bitcoin’s volatility has doubled compared to last week,” said Pratik Kala, Head of Research at digital asset hedge fund Apollo Crypto. “Participants like us and others have realized this is a ‘bloodbath’ moment.”

According to CoinGlass data, in the past 24 hours, approximately $2.1 billion worth of bullish crypto bets were forcibly liquidated across the network.

Bitcoin holders also felt the pressure. Michael Saylor’s Strategy Inc. confirmed in a Thursday earnings announcement that due to the mark-to-market decline on its massive holdings, it posted a net loss of $12.4 billion in the fourth quarter. Nevertheless, as Bitcoin rebounded, Strategy Inc.’s stock price rose about 10% on Friday (UTC+8).

Meanwhile, investors withdrew $434 million (UTC+8) from U.S. Bitcoin exchange-traded funds (ETF) on Thursday.

BTC Markets analyst Rachael Lucas said traders are now focused on whether Bitcoin can hold the $60,000 level. If it fails to maintain that threshold, “it could fall towards the $55,000 area.”

Editor: Li Tong