Bitcoin has almost recovered all the losses from Thursday's plunge.
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Bitcoin is reclaiming its status as the “favorite” among thrill-seeking speculative traders.
On Friday, Bitcoin recorded its biggest surge in nearly three years, almost recouping all the losses from Thursday’s cryptocurrency market plunge, during which sell-offs drove Bitcoin more than 50% below its peak last October. The wild 13% swing has reignited surging market volatility, which traders traditionally favor due to its potential profit opportunities.
On Friday, Bitcoin jumped as much as 13% to $71,469. Less than 24 hours earlier, its price had approached the $60,000 mark for the first time since October 2024. Nevertheless, Bitcoin still ended the week down more than 15%, and had closed above $84,000 last Friday.
Other smaller and less liquid tokens also rebounded sharply on Friday. Ethereum and Solana both rose 9%, and XRP surged over 30%. Bitcoin now accounts for nearly 60% of the $2.38 trillion total crypto market capitalization.
Since last October’s series of fierce forced liquidations undermined market confidence, cryptocurrencies have remained turbulent. This week, the sell-off was further intensified as leveraged bets were unwound and broader market volatility increased.
Noelle Acheson, author of “Crypto is Macro Now” newsletter, said: “This feels like a relief rally after a wave of selling exhaustion. Gold and silver also rebounded at the same time.”
Damien Loh, Chief Investment Officer at Ericsenz Capital, said the rebound from $60,000 suggests “strong support” at that level. However, as market sentiment remains cautious, traders should not “expect a swift rally.”
The wild swings in the past 48 hours highlight the sharp surge in volatility.
According to Kaiko data, Bitcoin is experiencing the most extreme volatility since the collapse of cryptocurrency exchange FTX, with repeated failed rebounds triggering new rounds of forced selling. Market depth remains over 35% lower than in October, with the last such decline seen after FTX’s collapse at the end of 2022. In such a low-liquidity environment, even relatively modest flows can amplify price swings and trigger more liquidations.
The Bitcoin Volmex Implied Volatility Index—based on real-time crypto option prices and reflecting the market’s expectation of Bitcoin’s volatility over the next 30 days—surged from 57% on Thursday to over 97%.
Pratik Kala, Head of Research at digital asset hedge fund Apollo Crypto, said: “Bitcoin’s volatility has doubled compared to last week. Participants like us are already aware that this is a bloodbath moment and are actively buying in.”
According to CoinGlass data, about $2.1 billion in bullish bets across the entire cryptocurrency market were forcibly liquidated in the past 24 hours.
Long-term Bitcoin holders are also feeling the pressure. In Thursday’s earnings report, Michael Saylor’s Strategy confirmed that due to the market value revaluation of its massive holdings, the company posted a net loss of $12.4 billion in the fourth quarter. Nevertheless, as Bitcoin rebounded, Strategy’s share price rose 26% on Friday.
Fabian Dori, Chief Investment Officer at Sygnum Bank, said: “In such a market environment, Bitcoin as a store of value always faces challenges. But it’s important to remember that Bitcoin isn’t a short-term store of value, nor is it a tool for hedging short-term market volatility.”
On Thursday, investors withdrew $434 million from US Bitcoin exchange-traded funds (ETFs), keeping market watchers cautious.
Adam McCarthy, research analyst at Kaiko, said: “I don’t see any major catalysts at the moment; this is just a reflection of the current market state. Market activity has clearly slowed, so even small buying on dips can push up prices. But if this trend continues, I would be very surprised—the overall mood has not improved, and headwinds far outweigh tailwinds.”
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