Analysts have linked the prolonged decline in the cryptocurrency market to capital outflows into AI and macroeconomic uncertainty, but see signs of recovery.
The crypto market has entered a phase of prolonged decline in investment risks, and the main question has shifted from “how far will we fall” to “when will demand return.” The answer depends on expectations, which remain uncertain, according to Binance Research analysts in their weekly report titled “Finding Optimism in a Market Reset.”
In early February, Bitcoin (BTC) fell 50% from its historic high of $126,000 reached in October 2025. This is the ninth drawdown of this magnitude in the history of cryptocurrency. As experts noted, although the crypto market has become more stable compared to previous cycles, the psychological pressure in such conditions remains strong.
Two main factors are at work in the current environment, Binance analysts write. The first is the rotation of capital from cryptocurrencies to the artificial intelligence (AI) sector and other defensive investment strategies.
The second is the policy of the US Federal Reserve (Fed) and macroeconomics, where expectations of a tough stance by the regulator and the risk of a US government shutdown prevail. Taken together, according to Binance, this creates an “unfavorable environment” for investing in cryptocurrencies.
According to experts, the weakness of altcoins in this cycle has been more pronounced than before. Capital is concentrated in the largest coins, moving away from speculative tokens. The situation was exacerbated by an influx of new projects, where out of 20.2 million tokens launched in 2025, about 11.6 million have already ceased to be actively traded. Many entered the market without a working product or revenue, with prices driven by hype. As a result, most of them are trading well below their initial valuations.
At the same time, small tokens have recently seen less dramatic movements than market leaders, “which may indicate that selling pressure is gradually easing.”
The Binance report also mentions the current average purchase price of Bitcoin for all its holders — $55,000. They noted that as the price of Bitcoin approaches this level, “psychological pressure” in the market intensifies. However, they clarified that “the potential significance of keeping Bitcoin at this level” increases as it approaches it.
Dependence on macroeconomics
Macroeconomics remains the main driver of the crypto market, according to Binance experts. As an example, they cited January's US employment data, which came in stronger than expected, but an annual revision showed that 2025 was the worst year for job creation since 2020.
Thus, according to Binance, the weak economic situation does not give the Fed a reason to ease policy, but only convinces it to maintain a wait-and-see position. Experts also noted the situation with Kevin Warsh's nomination as the new head of the Fed, which only led to increased uncertainty about future prospects.
Bitcoin has historically been “the most sensitive asset” to changes in global liquidity, the report said. In conditions of limited liquidity, it is an obstacle to the growth of the price of Bitcoin, but as soon as the situation changes, the same factor will become a “tailwind.”
Liquidity refers to the injection of funds into the US economy by the Federal Reserve. The Fed's base rate is not rigid in itself — it is a target value that the Fed strives for in its monetary policy. Rates are lowered or raised by increasing or decreasing liquidity in the banking system.
In this sense, the markets expect Warsh to pursue a more accommodative monetary policy, which implies a reduction in the Fed's rate and, as a result, an influx of liquidity into the markets.
The structural argument is still valid
Despite the decline, fundamental positive factors for the crypto market remain in place, experts believe, citing several arguments. The volume of assets in Bitcoin-based exchange-traded funds (ETFs) has declined only slightly, even with a 50% drop in price. According to the report, this means that investors perceive them more as a strategic asset, and there are signs of accumulation during the downturn.
Experts also highlighted the capitalization of stablecoins, which remains above $305 billion, close to the historic high of over $311 billion reached in January. The report notes that, unlike previous downturns in the crypto market, capital is not leaving, waiting for the right moment.
The report also pointed to the development of tokenized assets (Real World Assets, RWA), highlighting stablecoins based on physical gold — at the peak of gold price growth, these assets showed a capitalization increase of more than 50% since the beginning of 2026. According to The Block, the peak capitalization was recorded on February 5 at over $6.3 billion.
As the main positive signal of the outgoing week (as of February 15), Binance noted that BlackRock, the largest asset management company, announced the withdrawal of its tokenized BUIDL fund to the decentralized exchange Uniswap. As part of the deal, BlackRock also acquired an undisclosed amount of the exchange's native tokens, UNI. This, as noted by Binance, “shows the presence of liquidity ready for action against the backdrop of reliable catalysts.”