Is Bitcoin Playing Hide and Seek with $58K? Spoiler: It’s Not Winning!

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Ah, Bitcoin! The elusive digital currency that’s about as stable as a cat on a hot tin roof. Once gallivanting around the lofty heights of $78,000, it has now decided to take a rather unfortunate tumble, courtesy of our furry friends known as bears-those relentless creatures that seem to have a penchant for knocking prices down just when you thought they were getting comfy.

According to Alex Thorn, who holds the esteemed title of research head at Galaxy Digital (a position that sounds far more glamorous than it probably is), the current state of on-chain data resembles the aftermath of a particularly rambunctious party-think confetti everywhere, but instead of joy, there’s just a lot of uncertainty swirling around like a lost sock in the laundry.

Downtrend Firms Up

In his latest research note, Thorn paints a delightful picture of despair, highlighting the dramatic sell-off that took place late last month, where Bitcoin plummeted a staggering 15% in a matter of days-because why wouldn’t it want to set a record? Saturday alone saw a glorious 10% drop, resulting in one of the largest liquidation events recorded. Over $2 billion worth of long positions were liquidated, which is approximately the GDP of a small fictional country.

At one point, Bitcoin found itself flirting dangerously close to $75,644 on Coinbase, and even more hilariously, it tripped and fell below the average cost basis of US spot Bitcoin ETFs, which was around $84,000. If that’s not a classic case of “Oops, I did it again,” then what is? It also briefly traded beneath Strategy’s reported average cost basis of $76,037, and let’s not forget its one-year low of $74,420-set during an event charmingly dubbed the “Tariff Tantrum.”

Thorn’s analysis reveals that a whopping 46% of Bitcoin’s circulating supply is currently “underwater.” No, they haven’t taken a vacation in a submarine; it merely means that those coins were last moved when prices were higher, making them feel a bit like folks stuck in a bad relationship-waiting for things to get better without much hope in sight. Strangely enough, January marked the first time since 2018 that Bitcoin closed with four consecutive red monthly candles-an achievement that surely deserves a participation trophy.

With a projected price hovering near $56,000 and the moving average around $58,000, it seems Bitcoin is playing a rather disheartening game of limbo: how low can it go? The gap between roughly $82,000 and $70,000 indicates that demand in this range might be as scarce as a unicorn at a dog park, making further declines increasingly likely.

While the potential passage of the CLARITY Act could provide a flicker of hope, the odds of that happening seem to have dwindled faster than a magician’s rabbit on a good day. This means any positive impact from such legislation might just end up benefiting altcoins more than our dear Bitcoin.

As these factors conspire against our beloved BTC, analysts are beginning to suspect it might drift toward the lower end of the $70,000 range, potentially testing the fabled realized price and 200-week moving average in the high-$50,000 area. Historically, these levels have been like the comfy couch of the cryptocurrency world, representing cycle bottoms and ideal long-term entry points for those brave enough to sit down.

BTC Bottom May Be Deeper

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2026-02-03 22:09