The post Binance Report Says Bitcoin Crash Driven by Liquidity Scramble appeared on BitcoinEthereumNews.com.

Key Insights: Traders dumped crypto as Warsh’s nomination triggered fears of aggressive Fed policy tightening. Crypto markets fell harder than gold, showing their lower position in the liquidity sell-off chain. Structural limits may block major balance sheet cuts, despite Warsh’s known stance on tightening. Binance Report Says Bitcoin Crash Driven by Liquidity Scramble Bitcoin has fallen to its lowest point since late 2024, hitting $63,800 as of press time. The sharp decline came after the nomination of Kevin Warsh to lead the U.S. Federal Reserve. His past support for tighter monetary policy led to selling across risk assets, including cryptocurrencies. The market moved quickly. Bitcoin broke through several key price levels. Other digital assets followed, with Ethereum also dropping below key support. Over the past 24 hours, crypto markets saw more than $1.3 billion in liquidations. Trading volumes spiked as investors rushed to reduce exposure. Risk-Off Mood Drives Asset Repositioning The sell-off in crypto came as traders scrambled for liquidity. Weak earnings from top tech companies and rising global tensions added to the stress. Once Warsh’s nomination was announced, traders sold off what they could, starting with the most liquid assets. Gold prices also dropped at first but recovered soon after. Crypto did not. The continued slide in digital coins, even as gold bounced back, showed that crypto sat lower in the liquidity order. As investors raised cash, crypto was sold quickly and heavily. Binance Research noted that this behavior matched patterns seen in past liquidity crunches. Investors offloaded digital assets to cover margin calls and reduce risk. Technical Limits May Slow Fed Tightening Binance analysts said fears of deep balance sheet cuts under Warsh may be too strong. While he has supported reducing the Fed’s bond holdings before, there may be limits to how much can actually be done.…

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Filed under: News - @ February 5, 2026 9:20 pm