Bitcoin’s notable drop to approximately $60,000 in February has left a significant mark on the cryptocurrency landscape, being classified by many as a pivotal moment of market capitulation. A detailed analysis by Checkonchain highlighted this drop as a capitulation event that occurred rapidly, accompanied by robust trading volume and substantial losses that served to recalibrate market psychology.
According to the report, this event is best understood as part of a broader, staged market exit, where sellers transitioned in phases. The data points to an initial capitulation occurring in November 2025, when Bitcoin’s value fell to around $80,000. In this situation, a large portion of losses—estimated at about $2 billion per day—was driven predominantly by the “class of 2025,” which refers to those who acquired Bitcoin within that year. These sellers had been trapped in a long-term market stagnation, ultimately giving in to persistent pressures that forced them out.
The analysis further divides the market behavior into two distinct acts, demonstrating a shift in the types of sellers during each phase. The first act in November 2025 primarily involved long-term holders whose patience had worn thin due to a year of sideways trading. This prolonged stagnation created significant psychological burdens, leading to a capitulation characterized by exhaustion—where the pain of waiting outweighed the potential for future gains.
The second act unfolded in February 2026, marked by a dramatic drop to about $60,000 and affecting a broader mix of sellers, including both the exhausted holders from the previous cycle and newer investors from 2026, who had anticipated a bottom at higher price points. This influx of newer sellers, who became discouraged after their purchases in a supposed bear-flag zone, coincided with a wave of regret among holders from 2025 who wished they had sold at higher prices. This psychological combination created an impactful selling environment, amplifying realized losses to around $1.5 billion per day during this period.
The volume trends during this capitulation event were unprecedented. Aggregate spot trading volume reached approximately $15.4 billion per day, with ETF trading climbing to a historic $45.6 billion weekly. Futures trading surged beyond $107 billion daily, showcasing the scale of the panic and forced selling across various trading venues.
Market observers struggle with the aftermath of such capitulation events, often gravitating toward neat calendar narratives that suggest predictable cycles. However, this analysis suggests a different framework: the capitulation was not merely a single event but rather a complex interplay of different seller cohorts experiencing their own moments of despair. Recognizing these nuances allows for a clearer understanding of market recovery and the potential evolution of risk appetite moving forward.
The situation underscores a vital lesson about assessing market bottoms—not as isolated price points, but as processes that unfold around established cost bases. The realized price, estimated at about $55,000, and a broader market mean of around $79,400, signal important levels for future support and resistance.
Ultimately, the clashes between different groups of sellers—those burned by prolonged stagnation and those learning harsh lessons about timing—have created a quieter market. As the dust settles, the landscape may gradually shift back toward a recovery phase, emphasizing a careful digestion of realized-loss pressures and a rebuilding of market sentiment rather than a quick return to previous highs.
