Bitcoin’s Bearish Breakdown: Why Crypto’s Real Stress Test Is Only Just Beginning

If you thought Bitcoin was immune to geopolitics, this weekend was your wake-up call. As US and Israeli jets roared over Iranian airspace, Bitcoin’s price action did its best impression of a fighter pilot in a tailspin. The world’s largest crypto plunged below $64,000, trading at $63,922 as of February 28, 2026, after a bruising February that left even the diamond-handed crowd reaching for the exit button. The narrative that Bitcoin is a safe haven in times of crisis just took a round-trip to the shredder.

The carnage wasn’t limited to Bitcoin. Altcoins got steamrolled. Ethereum, XRP, and Solana led the losers, with double-digit drawdowns that made the S&P 500’s worst days look like a gentle breeze. The crypto market, for all its talk of decentralization and resilience, acted like a leveraged ETF on Middle East headlines. The catalyst? Joint US-Israel strikes on Iran, which triggered a global risk-off move that crypto could not escape. According to news.bitcoin.com, "The cryptocurrency market served as a real-time volatility barometer over the weekend as joint U.S. and Israeli strikes on Iran triggered a sharp selloff."

BlackRock, the institutional whale that everyone loves to hate, paused its Bitcoin selling spree after dumping $269 million in the prior three days. That was enough to stop the bleeding, but not to reverse the trend. The market is now debating whether this is the start of a true bear market or just another shakeout before the next leg higher. Crypto Twitter, never shy with opinions, is split between doomsday and "buy the dip" euphoria. Meanwhile, the data says the pain might not be over.

Let’s zoom out. Bitcoin’s current drawdown is a far cry from the 2022 and 2023 bear markets, but the signs are familiar. The higher-timeframe structure is rolling over, with crypto analyst Crypto Patel warning that "Bitcoin has officially entered bearish territory, and it's headed to $35,000." That’s not a typo. The technicals are ugly, with key support levels breaking and momentum indicators flashing red. Yet, traders who bought Bitcoin three to five years ago are still up around 90% on average, according to Cointelegraph. The long-term trend is intact, but the short-term pain is real.

The macro backdrop is not helping. Rising geopolitical risk, sticky inflation, and a Fed that’s in no mood to cut rates all add up to a toxic cocktail for risk assets. Bitcoin, which once prided itself on being uncorrelated, is now trading like a high-beta tech stock. The correlation with the Nasdaq is at multi-year highs, and the safe haven narrative is looking more like a marketing slogan than a trading strategy.

Strykr Watch

From a technical perspective, Bitcoin is in no-man’s land. The $64,000 level is now resistance, with the next major support at $60,000 and a psychological floor at $58,000. If those levels break, the path to $52,000 and even $35,000 is wide open. RSI is oversold on the daily, but there’s no sign of a reversal. Volume is heavy on down days and anemic on bounces, a classic bear market signature. The three-day accumulation streak from BlackRock is a positive, but it’s a drop in the ocean compared to the selling pressure from retail and leveraged longs unwinding.

Hashrate concerns are swirling, with some observers noting that even if Iran controls 5% of global hashrate, the network would continue functioning without disruption. That’s cold comfort for traders watching their P&L evaporate. The real stress test is not network security, but market structure. Liquidity is thin, order books are shallow, and slippage is brutal. If another wave of selling hits, expect flash crashes and forced liquidations.

The bear case is straightforward: if Bitcoin fails to reclaim $64,000 quickly, the next leg down could be swift and ugly. Altcoins are even more vulnerable, with ETH, XRP, and SOL all breaking multi-month support levels. If the macro backdrop worsens, think more Middle East escalation or a hawkish Fed, crypto could see another 20-30% drawdown in short order.

But there’s opportunity in chaos. For traders with ice in their veins, the current environment is ripe for tactical shorts and quick scalps. If Bitcoin manages to reclaim $64,000 and hold above $66,000, a squeeze to $70,000 is possible. For the long-term crowd, the data says that holding for three to five years still delivers outsize returns, even after brutal corrections. The key is position sizing and risk management. This is not the time to YOLO the farm.

Strykr Take

Bitcoin’s safe haven myth has been shattered, at least for now. The real story is not about network security or institutional flows, but about market structure and macro risk. The Strykr view: respect the bear, trade the volatility, and don’t get married to a narrative. The next few weeks will separate the traders from the bagholders.