The post What’s Really Behind Bitcoin’s Latest Drop appeared on BitcoinEthereumNews.com.

Bitcoin Bitcoin’s sharp price swings this week have pushed traders and analysts to look beyond simple narratives of fear or spot selling. Key Takeaways Recent Bitcoin volatility may be driven by dealer hedging tied to structured products linked to IBIT, rather than spot market selling. $64,000 has emerged as a key technical level, with a break below it potentially signaling a deeper market reset. Together, structural flows and macro pressures suggest Bitcoin remains vulnerable to sharp, mechanically driven moves. One explanation gaining traction centers on structured products and dealer hedging dynamics rather than organic shifts in demand. Arthur Hayes argued that the latest $BTC drop was likely driven by banks and dealers hedging exposure tied to structured notes linked to the iShares Bitcoin Trust (IBIT). These bank-issued products often embed complex payoff structures that require dealers to dynamically hedge their exposure as Bitcoin’s price rises or falls. When key thresholds are crossed, hedging activity can intensify abruptly, pushing prices lower or higher in a self-reinforcing loop. Hayes noted that as the “game changes,” market participants must adapt as well. He is now working to compile a comprehensive list of issued structured notes to better understand where hidden trigger points may lie. These levels, once breached, could mechanically force dealers to sell or buy Bitcoin-related exposure, accelerating volatility even in the absence of major news. $BTC dump probably due to dealer hedging off the back of $IBIT structured products. I will be compiling a complete list of all issued notes by the banks to better understand trigger points that could cause rapid price rises and falls. As the game changes, u must as well. pic.twitter.com/9DF8VE9XBL — Arthur Hayes (@CryptoHayes) February 7, 2026 The growing influence of structured finance has raised concerns that Bitcoin’s short-term price action is becoming less reflective of…

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Filed under: News - @ February 8, 2026 5:51 am