The risk of a U.S. government shutdown triggers a sell-off, with Bitcoin falling below $70,000, and the crypto market faces further turmoil.

February 10 News: The cryptocurrency market came under further pressure, with the total market capitalization declining by approximately 2% in a single day, mainly due to growing investor concerns over a potential U.S. government shutdown. The risk-off sentiment intensified, leading to an accelerated outflow of funds from risk assets.

Bitcoin, as a market indicator, fell about 2.4% on the day, fluctuating between $68,400 and $71,000, currently stabilizing around $69,400. Ethereum declined nearly 3%, barely holding above the $2,000 mark, with its weekly decline expanding to 12%. XRP, BNB, Solana, and Dogecoin also weakened, dragging the overall crypto market cap back to approximately $2.44 trillion.

The rapid price correction triggered leveraged liquidations. According to CoinGlass data, nearly $300 million was liquidated in the past 24 hours, mostly from long positions, further amplifying short-term selling pressure.

The core cause of this volatility is the deadlock in U.S. federal budget negotiations. If Congress fails to reach an agreement by February 13, the government may enter a partial shutdown. The predictive market Polymarket shows the probability of a shutdown once spiked to 76%, and remains high. This uncertainty could not only impact macroeconomic expectations but also slow down legislation related to cryptocurrencies, with the review of the “Clear” bill being postponed, further increasing regulatory uncertainty.

Meanwhile, market sentiment has also been affected by the new nomination of Kevin Warsh, who holds a hawkish stance. U.S. stocks have recently weakened, while safe-haven assets such as gold, silver, and U.S. Treasuries have strengthened, indicating funds are shifting from high-risk assets to defensive assets. Historical experience suggests that cryptocurrencies tend to be among the first to come under pressure in such environments.

Institutional movements remain cautious as well. Data from SoSoValue shows that the U.S. spot Bitcoin ETF recorded only $145 million in inflows today, a significant decline from the previous trading day. Overall, there has been a net outflow this month, reflecting large-scale investors’ cautious outlook on the short-term market prospects. Multiple factors combined have kept market sentiment in a bearish zone.