Fear Index Plunges to 2024 Lows
Bitcoin’s price tumbled below the $70,000 threshold on Thursday, sliding to a session low of $69,917.20 and marking a drop of more than 7% over the previous 24 hours. Ether mirrored the decline, also falling over 7%, as market sentiment deteriorated rapidly. The widely watched Fear and Greed Index—a barometer for investor mood—plummeted to 11, its lowest point in 2024 and a level reached only a handful of times in the past. This sharp swing in sentiment has left traders on edge, with many recalling similar episodes of extreme fear that preceded periods of prolonged volatility.
The current downturn comes at a time when bitcoin is revisiting price zones that acted as strong resistance between March and October 2024. For context, in May 2022, a comparable selloff led to a month-long consolidation before prices slid even lower. Market participants are now watching closely for signs that history could repeat itself.
Alex Kupsikevich, chief market analyst at The FxPro, noted that bitcoin has returned to a resistance area last seen from March to October 2024.
Leverage Unwinds Accelerate Crypto Slide
Derivatives liquidations have played a central role in amplifying bitcoin’s decline this week. As leveraged positions unwound en masse, selling pressure intensified across major cryptocurrencies—including XRP and ether—triggering further losses. Bitget’s chief market analyst cited not only the impact of derivatives but also macroeconomic headwinds such as heightened geopolitical risk and uncertainty around interest rates. These factors have prompted investors to reduce exposure to higher-beta assets, accelerating the downward momentum.
On paper, the Nasdaq-tracking Invesco QQQ ETF was up slightly by 0.05% in pre-market trading; in contrast, crypto-linked equities took a hit. MicroStrategy shares dropped more than 5%, leaving them nearly 80% below their all-time high from November 2024. Coinbase fell another 2%, while digital asset firms like Strive and Nakamoto each lost around 6%. The disconnect between traditional tech stocks and digital assets has rarely been so stark.
Gold and silver joined the selloff: gold slipped more than 1% to under $4,900 per ounce, while silver plunged over 11% to below $79 per ounce.
Miners Face Mounting Profit Pressure
For bitcoin miners, the recent price drop has introduced new financial strains. The average cost to mine one bitcoin currently stands at roughly $87,000—about 20% above spot prices after this week’s fall toward $70,000. This means that many miners are now operating at a loss based on industry-wide production cost estimates that use network difficulty as a key metric. In response, some miners have begun selling their bitcoin reserves to cover energy bills and service debt obligations.
Hashrate—the measure of computational power securing the network—peaked near 1.1 zettahash (ZH/s) last October before dropping by approximately 20%. While it has recently rebounded to around 913 exahash (EH/s), the sector remains under pressure as profitability dwindles. Previous bear markets in both 2019 and 2022 saw bitcoin trade below production costs for extended periods before eventually recovering.
Historic Selloff Mirrors Past Patterns
Stifel analysts issued a stark warning on Wednesday: bitcoin could crash as low as $38,000 if historical patterns persist. Their note referenced previous drawdowns of up to 93% (2011), 84% (2015), 83% (2018), and most recently, 76% (2022). With bitcoin having peaked above $126,000 last October before halving its value by June 2025, comparisons to prior cycles are increasingly hard to ignore.
Despite these warnings, broader macroeconomic conditions remain uncertain. The Federal Reserve cut interest rates during its final three meetings of 2025 but maintained a hawkish tone; meanwhile, the Dollar Index has dropped nearly 1% this year after sliding almost 10% in the previous year. Oil prices have also stayed volatile amid escalating U.S.-Iran tensions—a reminder that crypto markets do not operate in isolation.
As reported by coindesk.com, many miners are now selling off their holdings just to keep operations afloat—a move reminiscent of prior capitulation phases during major downturns.
The Key Lessons
- •Bitcoin (BTC) fell below $70,000 to $69,917.20, dropping over 7% in the past 24 hours.
- •The Fear and Greed Index plunged to 11.00, its lowest level in 2024 and rarely seen historically.
- •Derivatives liquidations and leveraged selling accelerated declines across major cryptocurrencies, including ether (ETH) and XRP.
Key variables ahead
MicroStrategy is scheduled to report fourth-quarter earnings later Thursday, and if the company discloses additional bitcoin sales or impairment losses amid BTC's drop below $70,000—now about 20% under the estimated $87,000 mining cost—it could trigger further immediate selling pressure from miners and institutional holders.