Bitcoin Price Plummets as Dormant Coins Move and Bybit Hack Intensifies Market Concerns

Bitcoin Price Struggles Amid Dormant Coin Movement

A significant movement of dormant Bitcoin (BTC) has sparked concern among investors. According to CryptoQuant analyst Martuun, 8,007 BTC, inactive for three to five years, has recently become active. This movement could indicate potential selling, consolidation, or security-related transfers. Bitcoin's price has dropped 3.3% in the last 24 hours, reaching a low of $82,111 before a slight recovery to $86,000. This marks a 12.6% loss over three days, the largest since FTX's collapse in November 2022.

Bybit Hack Exacerbates Market Downturn

On February 21, 2025, Bybit suffered a major hack, losing 403,996 ETH (approximately $1.13 billion) from its cold wallets due to a smart contract attack. This breach led to panic withdrawals totaling $4.3 billion across Bitcoin and stablecoins. The hack intensified market sell-offs, with Bitcoin's monthly performance dropping to -13.6%. This decline has returned Bitcoin to the realized supply "air gap" of $70,000 to $88,000, a zone with low-cost-basis density, indicating a challenging period for price recovery.

Market Sentiment and Future Outlook

The combination of dormant coin movement and the Bybit hack has deteriorated market sentiment, prompting a broad sell-off. Bitcoin's inability to sustain a recovery suggests ongoing macroeconomic pressures and weak investor confidence. The next few weeks are critical in determining whether Bitcoin can stabilize or face further declines. Analysts are closely monitoring macroeconomic indicators for signs of a potential rally, as market participants remain cautious amid heightened uncertainty.