Bitcoin fell to around $63,000 Thursday in what's shaping up as one of its worst single-day declines since the FTX collapse in 2022. The drop wiped out the entire Trump rally and pushed $BTC down roughly 50% from its October 2025 peak near $126,000.
What stood out wasn't just the magnitude but the context. This happened during a period of genuine geopolitical uncertainty—threats against Iran, tariff wars, tech stock carnage—exactly when Bitcoin's "digital gold" narrative should have provided support. Instead, gold rallied 68% over the past year while Bitcoin shed 30%. That divergence matters because it challenges the core thesis many institutional buyers used to justify allocation.
The mechanics behind the move reveal stress beyond simple selling. Over $2 billion in leveraged positions liquidated this week, ETF flows reversed from strong inflows to net outflows, and institutional demand that carried 2024-2025 has materially weakened. CryptoQuant noted Bitcoin broke below its 365-day moving average and declined harder than early 2022's bear phase. Analysts are watching the $58,000-$60,000 range as the next critical support, aligning with Bitcoin's realized price—the average cost basis across all holders.
Whether this marks capitulation or the start of deeper repricing depends on factors still unfolding: will liquidity conditions improve, can ETF flows stabilize, and does the Fed's direction shift sentiment back toward risk assets.
