Bitcoin whales and ETFs are baling out of the market; UBS warns ‘crypto is not an asset’

First, the good news. Bitcoin ticked up 5% this morning to $65.9K per coin.

That’s it. That’s all the good news about Bitcoin today. Everything else is bad news. The original cryptocurrency has lost 50% of its value, peak to trough, falling from a high of about $125K per coin in October 2025 to its low yesterday of $61.3K.

Shares in Strategy, Michael Saylor’s “Bitcoin treasury company,” which offers investors exposure to Bitcoin via its stock, fell 17% yesterday and are down 75% from their peak last year. At $65.9K, the price of Bitcoin is now well below the average price Strategy has paid for acquiring its horde, $76K. The company’s market cap is now billions below the value of the Bitcoin it holds. On its Q4 earnings call yesterday the company said it could cover all its convertible debt even if Bitcoin fell 90% in value, and that it had enough cash to honor its dividends for the next two and a half years.

The reason Bitcoin is in decline? The whales are selling up, according to Jefferies analyst Andrew Moss. “Large BTC holders are selling into weakness,” he told clients in a note this morning. “Whales transitioned to net sellers over the weekend after accumulating since early January.” Here’s his chart:

In addition, retail investors who had bought into Bitcoin via exchange-traded funds (ETFs) offered by traditional finance platforms are also selling. “Spot BTC ETF net outflows during the weeks of Jan. 19 and Jan. 26 marked the second and third largest since inception and were followed by large net outflows on Feb. 4,” he said:

“The all-too-familiar ‘crypto winter’ chatter has emerged yet again,” he wrote. “We see few bullish indicators that suggest we may be approaching the bottom,” particularly as there are no signs that small- and medium-sized holders are trying to buy the dip, he said.

His gloom was shared by many.

Yesterday’s performance was Bitcoin’s “worst daily decline since November 2022,” Deutsche Bank’s Henry Allen noted this morning. That was the month Sam Bankman-Fried’s FTX crypto exchange collapsed, taking with it billions in people’s savings.

At UBS, Paul Donovan was typically terse: “Crypto is not an asset, and is held by a tiny portion of society. It is unlikely that consumer behavior will change because of recent market moves.”

Chevy Cassar, the author of today’s Milk Road email, a respected crypto newsletter, said: “I’ll admit it: this sucks.” And it will get worse, he said: “The market is likely set to continue down, with history telling us that these assets will hit bottom anywhere in the next one to 11 months.”

“Market is near exhaustion, peak fear territory,” agreed Fabian Dori, chief investment officer at Sygnum Bank, which bills itself as “the world’s first regulated digital asset bank,” in an email sent to Fortune. 

Here’s a snapshot of the markets ahead of the opening bell in New York this morning:

• S&P 500 futures were up 0.54% this morning. The last session closed down 1.23%. 
• STOXX Europe 600 was up 0.29% in early trading. 
• The U.K.’s FTSE 100 was up 0.21% in early trading. 
• Japan’s Nikkei 225 was up 0.81%. 
• China’s CSI 300 was down 0.57%. 
• The South Korea KOSPI was down 1.44%. 
• India’s NIFTY 50 was up 0.2%.
• Bitcoin declined to $65.9K.

This story was originally featured on Fortune.com