Bitcoin drops toward critical support level amid slashed forecasts and institutional skepticism
The cryptocurrency industry is facing intensifying headwinds as major institutional players reassess their enthusiasm for digital assets and institutional confidence visibly erodes. Coinbase Global Inc., the largest U.S. cryptocurrency exchange, encountered significant operational challenges Thursday while simultaneously facing multiple analyst downgrades that signal growing concern about the sector’s trajectory.
Bitcoin declined sharply Thursday, dropping as much as 4 percent to $65,079 as momentum traders struggled to maintain support levels. The broader cryptocurrency market has shed nearly $2 trillion in value since October’s peak near $126,000, representing a devastating 45 percent decline that shows no signs of stabilizing.
The selling pressure reflects a fundamental shift in market psychology. What began as a narrative centered on renewed risk appetite and breakout momentum has transformed into a cautious environment where rallies consistently fail to gain traction and institutional conviction appears to be waning.
Major price target cuts signal institutional retreat
Standard Chartered Bank substantially reduced its Bitcoin year-end 2026 forecast to $100,000 from $150,000, representing a major reversal from the bank’s earlier prediction of $300,000 just months ago. More concerning for bulls, Standard Chartered warned that Bitcoin could potentially drop to $50,000 as a stabilization point, reflecting the bank’s acknowledgment of weakening price momentum and deteriorating macroeconomic conditions.
Market analysts indicated that Bitcoin appears likely to establish a trading range between $60,000 and $70,000 over the coming weeks, suggesting that near-term price discovery will occur within this compressed band. This consolidation pattern indicates that speculative demand has notably diminished and that the market has entered a more challenging phase where conviction is testing.
Coinbase faces operational and analyst pressures simultaneously
Coinbase encountered technical difficulties Thursday that prevented customers from executing fundamental transactions including buying, selling, and transferring digital assets on its platform. The exchange confirmed the issues on social media and later indicated the problems had been resolved, but the operational interruption arrived at a particularly vulnerable moment.
Simultaneously, Monness Crespi Hardt & Co. downgraded Coinbase to sell status, slashing its price target by 68 percent to $120 per share. The brokerage characterized prevailing assumptions about steady recovery as fundamentally flawed, given historical patterns in cryptocurrency bear markets that typically extend substantially longer than current timelines suggest. The firm reduced its revenue and earnings estimates through 2027, reflecting deep skepticism about near-term recovery prospects.
Coinbase shares declined approximately 8 percent to $140 following the announcement, marking the third consecutive day of losses. The stock has tumbled nearly 40 percent year-to-date as the broader market reprices the exchange’s earnings potential in a deteriorating crypto environment.
The convergence of negative signals
The Monness Crespi downgrade represents at least the sixth analyst price target cut issued in February alone, demonstrating widespread institutional reassessment across Wall Street. This synchronized downgrade activity marks a stark tonal shift from 2025’s rebound narrative toward a more cautious stance emphasizing downside risks.
Analyst consensus expectations compiled by Bloomberg anticipate Coinbase will report fourth-quarter earnings of 86 cents per share, representing an over 80 percent year-over-year decline. However, Coinbase’s own compiled consensus estimates predict even more severe results, forecasting a loss of 5 cents per share. This stark divergence suggests internal pessimism may exceed external expectations.
Market maturation or institutional withdrawal?
Standard Chartered analysts acknowledged that the current cryptocurrency selloff has been less extreme than previous downturns and has not triggered collapses of major digital asset platforms. This pattern could signal market maturation toward greater stability and resilience. However, the underlying dynamic reveals a troubling shift: fading momentum rather than fresh capital inflows now determines price direction.
The cryptocurrency sector has evolved into an environment where institutional focus has shifted from identifying new entry points to managing existing positions. Leverage indicators have turned defensive as traders unwind speculative positioning. Market participants acknowledge this dynamic represents typical late-cycle consolidation where excessive risk gets systematically cleared before potential structural shifts occur.
One potential bright spot involves retail investor positioning. Analysis indicates that retail participants have largely maintained their exposure to Bitcoin through spot exchange-traded funds, with net positioning remaining roughly unchanged since mid-January despite broader market turbulence. This retention of retail conviction contrasts sharply with institutional reassessment.
