Bitcoin rallied on Friday, reestablishing the psychologically important $70,000 level and trading higher amid a broader rebound in risk assets. At 14:53 ET (19:53 GMT) the world’s largest cryptocurrency was quoted at $70,826.9, representing an intraday gain of 8.6%.
That advance comes after a turbulent stretch for crypto markets. A "flash crash" in October 2025 preceded a period of weakening, and last Friday’s announcement of Kevin Warsh as a nominee to a key policy-related post coincided with a further sell-off that drove bitcoin down to a 16-month trough of $60,187.0. The move erased gains accumulated since President Donald Trump’s November 2024 election victory.
Thursday’s market mood was darkened by a substantially larger fourth-quarter loss reported by Strategy (MSTR), a major corporate holder of bitcoin. The company disclosed a Q4 loss of $12.4 billion, a steep increase from the prior year’s $670.8 million reading. Market participants interpreted that result as additional evidence of the strain on entities with concentrated crypto exposure.
Market context and recent price action
Even with Friday’s uptick, bitcoin was set to finish the week with losses of roughly 10.5%. From its record high, the crypto sits about 44% lower, placing it well within what market participants describe as bear market territory. In addition, the digital asset appeared poised to record a third consecutive week of declines.
"In historical context, the drawdown remains consistent with prior Bitcoin cycles during periods of macro tightening, which have typically been associated with extended consolidation and volatility compression rather than immediate trend reversals," said Dessislava Ianeva, an analyst at Nexo Dispatch.
Ianeva’s remark underscores a common market interpretation: tighter macro policy or the expectation of a leaner central bank balance sheet can compress risk appetite and sustain volatility rather than precipitate an outright and sustained trend reversal in risk assets like bitcoin.
Sources of recent selling pressure
Investors pulled back from higher-beta, speculative assets in recent weeks, a shift that intensified after Kevin Warsh’s nomination. Warsh is seen by some as less dovish given his past opposition to central bank asset purchases, and that stance has been read as increasing the probability of a smaller central bank balance sheet over time. Market participants tied that possibility to tighter monetary conditions and downward pressure on speculative instruments, including cryptocurrencies.
The resulting de-risking flowed into safer, more liquid instruments such as U.S. Treasuries, cash, and defensive equity sectors; equity moves — notably continued weakness in U.S. technology stocks, which have historically shown some correlation with crypto performance — also contributed to the selling across the sector.
Strategy’s balance sheet and market implications
Strategy reported a fourth-quarter loss of $12.4 billion, a dramatic increase from $670.8 million a year earlier. The company holds 713,502 bitcoins as of February 1, with those holdings recorded at an average cost of $54.26 billion, or $76,052 per bitcoin. With spot prices trading below that average cost, market concerns emerged that Strategy could face pressure to liquidate holdings to satisfy debt obligations. The company has financed its bitcoin accumulation through a combination of debt instruments and new share issuances and is led by Bitcoin advocate Michael Saylor.
Altcoin performance
Broader crypto market prices partially tracked bitcoin’s intraday recovery but entered the weekend nursing steep weekly declines.
- Ether rose 7.2% to $2,065.38, yet remained down about 16% for the week.
- XRP climbed 20.2% intraday, but was on track for a weekly decline of nearly 12%.
- Solana was headed toward an 18% weekly loss.
- Cardano was down around 5% for the week.
- Among memecoins, Dogecoin was down about 5.2% for the week, while the token $TRUMP was down roughly 17% for the week.
What to watch next
Friday’s bounce provides a short-term corrective move after a sharp drawdown, but the market remained sensitive to macro developments and corporate balance-sheet stress among large bitcoin holders. Participants will monitor whether the intraday recovery can be sustained into next week amid ongoing consolidation and the potential for continued volatility compression, themes highlighted by market commentators.
Ambar Warrick and Vahid Karaahmetovic contributed to this article.