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Bitcoin dipped to $62,700 this week, printing the most oversold weekly RSI in the asset’s entire history. A $575 million liquidation cascade followed within hours — and yet the structural damage underneath the bounce tells a very different story from the relief rally on your chart.
The Numbers Behind the Flush
Here’s what actually happened. On Tuesday 24 February, Bitcoin slid to as low as $62,700 according to The Block’s price data — its lowest since the 6 February flash crash to $60,033 that Bloomberg described as wiping out every gain since Trump’s election. By Wednesday, a violent squeeze ripped the price back toward $70,000 — BeInCrypto recorded a touch of $70,027 on Binance, while Coin Republic logged the session high at $70,038 — before fading just as fast. By Friday 27 February, BTC was back below $66,000, per CoinDesk’s live tracker, giving up most of the midweek pop. The bounce was real, but it was mechanical. BeInCrypto reported $468.5 million in short liquidations during the 24-hour window around that reversal. Cryptonews put total liquidations at $575 million, with nearly $500 million coming from short sellers alone. Bitcoin accounted for roughly $195 million of that, Ethereum another $175 million. The largest single liquidation hit Hyperliquid — a $10.41 million BTC-USD position — per Coinglass data cited by BeInCrypto. That’s not a trend reversal. That’s leverage getting cleaned out.
An RSI Reading for the History Books
The weekly Relative Strength Index, tracked via CryptoSlate data, printed at approximately 25.7 — the lowest reading in Bitcoin’s history on that dataset. Galaxy Digital’s head of research Alex Thorn flagged the signal on X, noting the weekly RSI on his chart sat at roughly 15.6 and was lower than almost any point since 2016. The only comparable readings, according to Thorn, came during the November–December 2018 crash from $6,000 to $3,000, and the June–July 2022 collapse when Three Arrows Capital blew up and Genesis turned out to be insolvent. Coin Bureau CEO Nic Puckrin independently confirmed the historic reading at 25.6, noting it fell below levels recorded during the Terra/Luna implosion, the FTX bankruptcy and the March 2020 Covid crash. VanEck’s digital assets team added another dimension: Bitcoin was trading 2.88 standard deviations below its 200-day moving average as of 5 February — a distance from trend that zero percent of observations in the past decade had exceeded. This matters because extreme RSI alone doesn’t call a bottom. CryptoSlate analysts made the point clearly: record-low RSI signals that capitulation is underway, but the market may not have finished searching for a durable bid. Choppy, range-bound grinding — not a V-shaped recovery — is the more common outcome after readings like this.
Where the Real Damage Lives
The structural picture is rough. CryptoQuant told CNBC that US exchange-traded funds which purchased 46,000 bitcoin this time last year are now net sellers in 2026. The spot Bitcoin ETF complex shed approximately $6.18 billion in net capital from November 2025 through January 2026, per Investing.com analysis — the longest sustained outflow streak since these vehicles launched. Five more weeks of outflows followed through 20 February, with $316 million in net redemptions in the week to that date alone, according to Wu Blockchain data cited by The Coin Republic. The bleeding reversed briefly: on 25 February, ETFs pulled in $506 million in a single day — the biggest daily inflow in weeks — led by BlackRock’s IBIT at $297 million and a surprise $102 million from Grayscale’s GBTC, per Coin Republic. Bloomberg’s Eric Balchunas called the timing poetic, noting the inflows arrived right as obituaries were being published. But he added: unclear still whether this is a legit start to a rebound or a dead cat bounce. Beneath the ETF drama, the liquidity picture keeps deteriorating. Coin Metrics reported that average spot order book depth — measured within 2% of the mid-price — has thinned from $40–$50 million between August and October 2025 to $15–$25 million in February. When the book is that thin, sell pressure moves price violently, creating air pockets and sharper gaps even without a fresh catalyst. Stablecoin supply for USDT and USDC has flatlined around $260 billion, per Coin Metrics, suggesting the market isn’t seeing a wave of new capital at precisely the moment it needs one.
The Basis Trade Is Dead — and That Changes Everything
Here’s the part most price charts won’t tell you. The institutional plumbing that supported Bitcoin’s rally through 2024 has quietly broken. Investing.com analysis showed that the basis trade — buy spot Bitcoin via ETFs, short futures, pocket the spread — delivered 17% annual returns at its peak in 2024 with minimal risk. By early 2026, that yield had compressed below 5%. When the math stopped working, hedge funds unwound. That’s not panic. That’s portfolio management. And the Coinbase Premium Index, which tracks the price gap between Coinbase and offshore exchanges like Binance, went negative for 21 consecutive days heading into the crash, hitting minus $167.80 at its worst — the deepest negative reading in a year. US-based institutional money wasn’t buying the dip. It was leaving. AMBCrypto reported that the premium has since flipped back to positive, and ETF inflows have resumed, but the structural question remains unanswered. Adam Back — the cryptographer cited in Bitcoin’s original white paper — told CoinDesk that this decline is consistent with past four-year cycles. Steven McClurg, CEO of Canary Capital, went further on CNBC, saying he expects Bitcoin to fall as low as $50,000 by summer. Whether Back or McClurg turns out to be right, one thing is clear: the $60,000–$70,000 range that has defined late February is not equilibrium. It’s a holding pattern while the market decides whether the leveraged excesses of 2024 and 2025 have actually been flushed — or whether another leg down is still coming.
