Bitcoin (BTC) hit $60,033 again, reviving FTX-era volatility signals. The move matters because a Federal Reserve official is linking the selloff to institutional risk controls, not just retail sentiment. Still, that framing pulls crypto closer to mainstream macro discussion. Large trading desks are watching that shift closely.
Christopher Waller, a governor at the Fed, spoke Monday in La Jolla, California. At a conference hosted by the Global Interdependence Center, he said the post-election optimism that lifted crypto after President Donald Trump's victory is fading. He described sharp drawdowns as familiar for the market, and pointed to uncertainty around regulation as a trigger.
Crypto selloff: is post-election optimism fading?
Bitcoin is down more than 40% from its October peak. Last week’s drop to $60,033 (per Bloomberg) marked its lowest level since October 2024 and produced the biggest volatility spike since the 2022 collapse of crypto exchange FTX. The drawdown has also eroded gains tied to expectations of wider institutional adoption and a friendlier political backdrop.
That mix helps explain why the Fed is paying attention. When hedge funds, trading desks, and exchange-traded funds (ETFs) sit on material exposure, crypto swings can transmit through margin, collateral, and risk limits. Yet the same channels can speed up forced selling when liquidity thins and volatility rises.
Waller said, “Some of that’s kind of fading,” referring to the earlier post-election boost. He added that firms entering from mainstream finance “had to adjust their risk positions,” suggesting deleveraging can amplify spot moves. In his telling, volatility is not a surprise; the catalyst is how quickly big balance sheets resize.
FED’S WALLER: CRYPTO CLARITY STALLED, HYPE FADING
— *Walter Bloomberg (@DeItaone) February 9, 2026
Fed Governor Christopher Waller said Congress has stalled on crypto rules, his plan for Fed “skinny accounts” hasn’t prevented lawsuits, and the crypto enthusiasm tied to Trump is fading.
The signal is not about prices alone today. If regulatory direction remains unclear, institutions are likely to keep trimming exposure into rallies and protecting downside through hedges. Next catalyst is whether clearer rules arrive before major desks rebuild risk budgets in size.
