Welcome to the inaugural edition of our new monthly newsletter, a dedicated resource designed to provide you with a comprehensive pulse check on the current Bitcoin landscape.
In this and future newsletters, we aim to equip you with institutional-grade market analysis, critical updates on global Bitcoin news, and insights into Xapo Bank’s own metrics and performances.
We are committed to ensuring you remain at the forefront of the Bitcoin world as we navigate this significant regime shift in the global economy together.
February BTC Market Update
Overview
The bearish momentum that defined the start of February—pushing Bitcoin to a mid-month low near $63,120— met an institutional counter-offensive towards the end of the month. While the market remains around 47% below its October 2025 all-time high of $126,000, the final week of February saw a decisive ~11% bounce off the lows. Bitcoin is currently testing the $64,000–$68,000 resistance band, a zone that has acted as a line in the sand for bulls and bears alike.
Key Market Drivers
Price Action & Cycle Realignment: BTC fell to below $65,000 in mid-February, triggered by President Trump’s announcement of a 15% global tariff. Bitcoin is now down ~26% YTD and nearly 47% from its October 2025 all-time high of $126k. Analysts increasingly view this as a four-year cycle correction rather than a routine dip.
The Digital Gold Divergence: A significant decoupling occurred in mid-February; while BTC tumbled on tariff news, Gold rose 2% and Silver jumped 5%. The narrative of BTC as a safe haven is under immense pressure as investors clearly favour traditional precious metals amid macro uncertainty. However, the divergence has softened; as BTC briefly reclaimed $67,000 in the final week of February, the aggressive rotation into Silver and Gold seen earlier in the month began to consolidate.
On-Chain Capitulation: The aSOPR (Adjusted Spent Output Profit Ratio) fell into the 0.92–0.94 range, a level historically associated with deep bear market stress (2019/2023). Realised losses for short-term holders peaked at $1.24bn/day on Feb 6th, before moderating to $480m/day by late February—signalling that while the bleeding has slowed, sellers are still exiting at a loss.
Net Inflows: On February 25, U.S. spot ETFs recorded $506.5 million in net inflows—the highest single-day total in three weeks. This reversed a five-week stretch of redemptions that had drained nearly $3.8 billion from the ecosystem.
Whale Dominance & Liquidity Thinning: The Exchange Whale Ratio hit 0.64, its highest level since 2015. This indicates that two-thirds of all exchange inflows are coming from the top 10 largest deposits. Compounding this, net USDT stablecoin inflows have shrivelled from $616m in November to just $27m, drastically reducing the dry powder available to support a price rebound.
Options Market - From Panic to Defence: Implied Volatility (IV) has stabilised around 48%, down from early February spikes. However, the Put Skew remains high (rising from 7 to 14 vol points), showing that traders are aggressively buying downside protection. Dealers are currently short gamma between $58k and $70k, meaning further drops could be accelerated by forced hedging.
Roundup
The late-February data confirms that while the structural deterioration was severe, the market’s plumbing—unlike the 2022 collapse—remains intact. The stabilisation of ETF outflows and the return of $500M+ daily inflow sessions suggest that the temporary confidence crisis is nearing its floor.
At Xapo Bank, we have observed a distinct shift in behaviour: For the first time since February 2025, monthly net flow flipped from selling to accumulation. While our members mirrored broader market trends by taking profits during Bitcoin’s previous all-time highs, this return to net buying at current price levels signals a renewed institutional and retail confidence in Bitcoin’s value.
Our View: The Path Ahead
We are moving out of the panic phase and into the accumulation phase. The $60k–$65k range has established itself as a formidable floor.
The potential passing of the U.S. Clarity Bill and the anticipated restart of the Fed’s rate-cut cycle later this year remain potent catalysts. We believe the current base-building around the $60k–$65k range is constructing a formidable floor. Once the whale selling exhaust is complete, the lack of overhead retail supply could allow for a swift move back upwards as institutional confidence returns.
Bitcoin News
Bitdeer Dumps 943 BTC: Singaporean miner Bitdeer has fully liquidated its Bitcoin treasury to pivot toward AI and HPC infrastructure, signaling a strategic shift from holding assets to building compute power.
Brazil Proposes National Bitcoin Reserve: Brazil has introduced the RESBit bill to establish a sovereign reserve of 1 million BTC over five years, potentially positioning the nation as the world’s largest state holder of Bitcoin.
White House Pushing for CLARITY Act: The Biden administration is aggressively fast-tracking the CLARITY Act for an April 2026 signing to cement U.S. digital asset regulations before the midterm election cycle.
Xapo Bank by the Numbers
BTC Credit Fund: 12-Month Performance Report
Executive Summary In the past 12 months, the BTC Credit Fund has proven its role as a premier capital preservation vehicle. While the broader market faced historic volatility—most notably the $19B October 10, 2025 Liquidity Collapse and the 23% January price reset—the fund maintained net inflows, growing its asset base by 33% while keeping net yields remarkably stable.
Percentage Increase: Realised a ~33% increase, achieved during a year of major price resets.
Yield Floor: Maintained a 2.54% APY floor, holding steady despite a 40% spot price retracement.
Yield Stability: Demonstrated high consistency with a 0.46% range, successfully scaling operations by 1/3 without diluting investor returns.
Meet the Xapo Relationship Management Team
Virtual Xapo Event: Xapo will host its first Virtual Event on March 11. More information to come.
Global Fraud Summit – Vienna: Joey Garcia will be attending the Global Fraud Summit in Vienna, March 16-17.
Xapo Institutional Brunch – Dubai: Melana Noory, Institutional Sales, EMEA, Thomas Doyle, Global Head RM, and Nazli D Alonzo, Senior Relationship Manager - EMEA, are hosting a Xapo Institutional Brunch in Dubai, March 25.
ISC2026 – London: Joey Garcia will be speaking at ISC2026 in London, March 26.
Recommended Reading & Listening
The Sovereign Individual: How to survive and thrive during the collapse of the welfare state Recommended by members of the cryptocurrency community, such as Naval Ravikant and Brian Armstrong, the book predicts a shift to an information age, empowering individuals over governments. Its core ideas about digital wealth, privacy, and financial freedom strongly resonate with the cryptocurrency movement, seeing Bitcoin as a tool for creating a "sovereign individual." Read the PDF version.
Episode 56: Masters of Scale | How to start a revolution | Xapo’s Wences Casares Wences Casares, the founder of Xapo Bank and the entrepreneur credited with bringing crypto to Silicon Valley, explains the path he took to reassure the masses that Bitcoin isn’t as different – or as dangerous – as they may think. Listen here.
