BTC Dips Below $80K Amid $2.55B Crypto Liquidations: Wintermute

• BTC drops below $80K for first time since April 2025, sparking one of the largest crypto liquidations ever.

• Macro events—Mag7 earnings, Fed Chair Warsh, and metals sell-off—drove broad market risk-off, hitting crypto hardest.

• Despite the sell-off, crypto infrastructure is strong, positioning is lighter, and recovery could come in 2H26.

Bitcoin fell below $80,000 over the weekend, sparking $2.55 billion in liquidations as macroeconomic pressures intensified. The drop marks the first breach of this level since April 2025, following Trump’s tariff announcement.

The market maker Wintermute highlighted that a convergence of factors drove the sharp sell-off, including mixed Mag7 earnings, a surprise Fed Chair nomination, and a violent correction in precious metals. Consequently, crypto underperformed most asset classes, except the S&P 500 and crude oil, which remained positive.

The setup for last week appeared fragile. BTC had repeatedly rejected the $95,000–$85,000 range over two months, suggesting limited upside. Markets digested multiple narratives slowly before the risk-off rotation accelerated into the weekend. The illiquid conditions of the weekend amplified selling pressure, resulting in one of the largest liquidation events in crypto history. “Crypto has been the poorest performer across assets,” Wintermute noted, emphasizing the broad impact on risk appetite.

Macro Drivers and Market Reaction

The nomination of Kevin Warsh as Fed Chair initially triggered hawkish concerns due to his historical skepticism of QE. However, Warsh’s recent arguments for a “high productivity, low inflation equilibrium” shifted expectations toward potential rate cuts of up to 100 basis points by October. Friday’s dollar strength reflected a 2.4 standard deviation beat on Chicago PMI rather than policy changes.

Meanwhile, Microsoft and other Mag7 earnings disappointed, shaking confidence in the AI trade. The results raised questions about whether AI infrastructure could justify current equity valuations. Consequently, risk appetite faltered across equities and crypto.

Additionally, the precious metals market faced a brutal unwind. Gold fell 9%, while silver plunged 26% intraday, triggering CME Comex circuit breakers. This move stemmed from speculative positioning rather than fundamental shifts.

Back in Price Discovery

Wintermute stressed that crypto remains in price discovery. Unlike prior bear markets driven by structural blowups, this decline stems from macro trends and oscillating narratives. Lighter post-liquidation positioning and weak conviction suggest volatility will persist.

However, the strong infrastructure, growing stablecoin adoption, and institutional interest could allow crypto to rebound once macro uncertainty clears, potentially in 2H26.