Bitcoin (BTC) is fighting for its life at the critical $68,000 support level today, marking a grim milestone in what is now officially the Bitcoin bear market 2026. After plummeting nearly 50% from its October 2025 all-time high of roughly $126,000, the leading cryptocurrency has pushed institutional sentiment into widespread panic. As prices hover dangerously below the average production cost for miners and the cost-basis for major corporate holders, analysts are sounding the alarm on a potential “vicious cycle” of forced liquidations that could send the market spiraling further.
The Treasury Crisis: ‘Strategy’ Underwater
The most alarming development in this digital asset treasury crisis is the precarious position of corporate giants that fueled the 2025 bull run. Strategy Inc. (formerly MicroStrategy), the poster child for corporate Bitcoin adoption, is now officially “underwater” on its massive treasury. With a reported holding of over 713,000 BTC acquired at an average cost nearing $76,000, the firm faces billions in unrealized losses as spot prices test the $68,000 floor.
For years, Strategy utilized a “flywheel” effect—issuing stock at a premium to buy more Bitcoin, which in turn boosted the stock price. That mechanism has now broken. Reports indicate the company’s stock is trading at a discount to its net asset value (mNAV), raising fears that equity investors might force a change in direction, or worse, that debt covenants could trigger crypto treasury liquidation events if the slide continues.
Miner Capitulation: Operating at a Loss
While corporate treasuries bleed on paper, the mining sector is bleeding cash. Following the 2024 halving and subsequent difficulty adjustments, the average all-in production cost for one Bitcoin has risen to approximately $87,000. With Bitcoin market crash February 2026 bringing prices well below this threshold, miners are capitulating at a record pace.
On-chain data confirms that major publicly traded miners are selling 100% of their daily production plus reserves just to keep the lights on. This flood of supply is overwhelming the shrinking demand, creating a persistent ceiling on any relief rallies. Unlike institutional Bitcoin selling which can be strategic, miner selling is existential—they must sell to survive, regardless of the price.
The ‘Vicious Cycle’ of Liquidation
The core of the current panic lies in the leverage that built up during the 2025 euphoria. Financial analysts warn of a cascading liquidation spiral. As the BTC price floor analysis weakens, it triggers margin calls for over-leveraged Digital Asset Treasury (DAT) firms. To meet these calls, firms are forced to sell assets, which drives prices down further, triggering the next wave of margin calls at lower levels.
Fear Gauge Hits Historic Lows
Investor sentiment has completely collapsed alongside the price. The Crypto Fear and Greed Index dropped to a record low of 5 (“Extreme Fear”) this week, a level not seen even during the FTX collapse. This extreme reading suggests that the market is currently driven purely by panic, with rational valuation models being discarded in favor of capital preservation.
Outlook: Is $68,000 the Bottom?
Technically, the $65,000–$68,000 zone represents the last major line of defense before a potential freefall toward $50,000. Bulls are hoping that the sheer magnitude of the drop—erasing half of Bitcoin's value in just four months—will attract value investors. However, until the crypto treasury liquidation threat is resolved and the “Strategy” premium stabilizes, the market remains on a knife-edge. The coming days will be decisive: if the $68,000 support holds, it could mark a generational buying opportunity; if it breaks, the industry may face its darkest winter yet.
