Bitcoin struggled to stay above $70,000, sparking concerns of a potential drop to $60,000. A $55 billion decrease in BTC open interest, futures market liquidations, and increased Bitcoin inflows to exchanges fueled the sell-off. Analysts debate if crypto-specific factors or larger economic issues are driving the downturn.

Bitcoin’s 30-day open interest change revealed a significant contraction across exchanges, with about 744,000 BTC worth of open positions closed. This massive deleveraging coincided with Bitcoin dropping below $75,000, indicating more than just spot selling as a driving factor.

Market analyst Boris highlighted that market sell orders continue to dominate, particularly on Binance, where derivatives CVD sits near -$38 billion over the past six months. Other exchanges show varying dynamics, with different CVD levels reflecting the market’s behavior and price movements.

Bitcoin inflows to exchanges surged in January, totaling around 756,000 BTC, with an additional 137,000 BTC since early February. On the supply side, exchange reserves increased, with analyst Axel Adler Jr. warning that continued growth could lead to increased selling pressure and potential further downside for Bitcoin.

Analysts predict that Bitcoin is unlikely to form a bottom in a single day or week, with durable market bottoms potentially forming after two to three months of consolidation near major support zones. Trader Mark Cullen sees the potential for downside towards $50,000 in a broader macro scenario but expects a short-term reversion after BTC swept weekly lows below $74,000.

Read more at Cointelegraph: $55B in BTC Futures Positions Unwound In 30 Days: Will Bitcoin Recover?