On January 31, 2026, Bitcoin temporarily dropped to below $76,000 for the first time since April 2025. Within a few hours, the price of the most popular cryptocurrency rebounded above $78,000. Such sharp fluctuations caused significant losses for traders in the cryptocurrency futures market, with liquidations totaling nearly $2.6 billion.
This is reported by Business • Media
Massive Liquidations and Impact on Traders
The majority of losses were incurred by holders of long positions: their losses reached $2.42 billion, while traders with short positions lost $162.8 million. The total number of traders who suffered losses from liquidations amounted to 435,344 individuals. In particular, liquidations on Ethereum futures reached $1.15 billion, while Bitcoin liquidations totaled $785.98 million.
In early October 2025, Bitcoin set an all-time price record, exceeding $125,000. At that time, the market experienced the largest wave of liquidations in its history – over $19 billion in just a few days.
Reasons for the Drop and Market Sentiment
According to analysts at The Kobeissi Letter, the event on January 31 was one of the largest liquidations in the cryptocurrency market:
“Today’s event has been called the tenth largest liquidation in the history of the cryptocurrency market.”
One probable cause of this crash was the second government shutdown in the last six months in the U.S. Disagreement over the federal budget between the two main parties led to a partial government shutdown, which could have long-term negative consequences for global financial markets. Last year, the U.S. already experienced a record 43-day shutdown, the longest in the country’s history.
The Fear and Greed Index in the crypto asset market dropped to 18 points – indicating an extreme level of fear among investors and traders. For comparison, just a week ago, this indicator was nearly twice as high.
In the prediction market Kalshi, most participants expect further declines in Bitcoin’s price to $59,000.
As of the preparation of this material, Bitcoin was trading at $78,360, according to TradingView.
It was previously reported that the U.S. Federal Reserve kept the base interest rate unchanged.