Ether has lost 30% since the beginning of the year: what is happening with the crypto asset market?
5 February 20:45
On February 5, Bitcoin, the world’s largest cryptocurrency, fell more than 3% during trading in Asia and found itself on the verge of the key psychological level of $70,000, dropping to $70,052.
This is the lowest value for Bitcoin since November 2024, according to Reuters , as reported by "Komersant Ukrainian".
The second-largest crypto asset by market capitalization , Ethereum, also fell by almost 2% to $2,086. Earlier this week, its price briefly fell below $2,000, the deepest drop since May last year.
How serious is the decline?
The current decline is part of a broader negative trend:
- Bitcoin has lost more than 7% in just one week;
- since the beginning of the year, its decline has reached almost 20%;
- Ether has fallen by almost 30% since the beginning of the year .
Analysts note that pressure on the crypto market is intensifying not only due to technical factors, but also due to macroeconomic expectations.
The Fed factor: a political signal to the markets
One of the catalysts for the sharp decline was the announcement of Kevin Warsh’s nomination as the next chairman of the US Federal Reserve.
Markets expect that if appointed, he may:
- take a tougher monetary stance;
- begin reducing the Fed’s balance sheet at a faster pace.
For risky assets, including cryptocurrencies, this signals lower liquidity and more difficult financing conditions.
Outflow of funds from ETFs: the main reason for the decline
Deutsche Bank analysts believe that the key factor in the decline was the massive withdrawal of funds from institutional crypto funds.
“We believe that this overall decline is mainly due to massive withdrawals from institutional ETFs. Since October 2025, when the decline began, billions of dollars have been withdrawn from these funds every month,” the bank’s analysts noted.
According to their data:
- in January, more than $3 billion was withdrawn from US spot Bitcoin ETFs;
- in December — about $2 billion;
- in November — nearly $7 billion.
Signal from traditional investors
According to Deutsche Bank experts, these figures are systemic in nature:
“In our opinion, these constant sales indicate that traditional investors are losing interest, and general pessimism about cryptocurrencies is growing,” analysts emphasize.
This means that the crypto market is receiving less and less support from large institutional players, who were one of the drivers of growth in 2023–2024.
The decline in cryptocurrencies is occurring against the backdrop of:
- expectations of tighter US monetary policy;
- a redistribution of capital in favor of defensive assets;
- growing interest in gold — in particular, at the end of January, it was reported that Tether’s gold reserves had grown by more than $5 billion, indicating a shift in investment priorities.
