The crypto market has shed more than $1 trillion from its January peak near $3.3 trillion. The contraction to roughly $2.26 trillion reflects sustained risk aversion as U.S. military operations involving Iran intensify.
U.S. President Donald Trump confirmed combat operations are ongoing and will continue until strategic objectives are achieved, warning Tehran of further consequences. February marked the steepest leg down, with total market capitalization sliding toward the $2.1 trillion to $2.2 trillion support zone during a broad capitulation phase. At press time, the market is consolidating near $2.26 trillion, with immediate resistance clustered between $2.35 trillion and $2.4 trillion.
Can Bitcoin Hold Key Technical Support?
Bitcoin (BTC) has mirrored the broader drawdown. After topping near $96,000 in early January, BTC fell below $70,000 and briefly wicked into the low $60,000s during February’s panic selling. It now trades around $66,200, sitting beneath both its 50-day simple moving average near $77,277 and 100-day simple moving average around $83,408, a configuration that confirms prevailing downward momentum.
Immediate support for BTC rests in the $64,000 to $65,000 range, with stronger structural demand closer to $60,000. A decisive break below $2.1 trillion in total market capitalization could expose the psychological $2.0 trillion level, extending the broader correction. By comparison, the January high marked one of the strongest multi-month expansions since the prior cycle, underscoring the scale of the reversal.
Momentum indicators suggest volatility has compressed, even as the bearish structure remains intact. Markets have not printed fresh lows since the initial strike-driven shock, but Trump’s confirmation of continued operations adds uncertainty that could weigh on risk assets.
Whether digital assets stabilize or retest February lows will likely hinge on geopolitical developments rather than internal crypto catalysts. Traders are now watching for either a sustained reclaim of $70,000 in Bitcoin or a breakdown below aggregate market support as the next directional signal.
