Bitcoin (BTC) has staged a notable recovery, reclaiming the $70,000 level after a significant sell-off, driven by aggressive accumulation from large holders known as "whales." On-chain data reveals a massive spike in inflows to accumulation addresses, with these entities acquiring over 66,900 BTC on February 6 alone, coinciding with the price bounce.
The cryptocurrency had fallen to as low as $60,000 on February 5, marking its lowest point since October 2024 and a nearly 25% decline over the prior month. This dip triggered a wave of buying from wallets holding between 10 and 100 BTC, with Glassnode's Accumulation Trend Score rising to 0.68, indicating the first broad-based buying spree since late November.
Institutional sentiment has been mixed. U.S. Bitcoin ETFs experienced substantial outflows last week, totaling $358.5 million, marking the third consecutive week of withdrawals. Major funds like the iShares Bitcoin Trust, Fidelity Wise Origin Bitcoin Fund, and Grayscale Bitcoin Trust all reported significant outflows. Year-to-date, nearly $2 billion has exited the Bitcoin ETF space.
However, Bitwise CEO Hunter Horsley noted that some institutions view the recent price crash as a buying opportunity, with conversations revealing intent to purchase at "discounted" levels. Despite this, large order book data suggests some whale-level reluctance to dive back in fully, indicating potential risk of further downside.
Market sentiment, as measured by the Crypto Fear & Greed Index, plunged into "extreme fear" territory, hitting a low of 6 before a slight recovery. Broader economic factors added pressure, including weaker U.S. labor data and Amazon's announcement of a planned $200 billion AI spend for 2026.
Analysts point to the Bitcoin Sharpe ratio retesting a historical demand zone as a potential signal for a demand resurgence. The focus now shifts to upcoming U.S. economic data, including retail sales and jobs reports on February 11, and the flow of liquidity into Bitcoin ETFs, which will be a key yardstick for institutional mood and the sustainability of the recovery.
