This is a segment from the 0xResearch newsletter. To read full editions, subscribe. I’ve had a horizontal line on my main BTC chart since the Nov. 26 test of the $91k level: “1D close below here = end of bull market.” With bitcoin ETFs experiencing over $2.4 billion in net outflows throughout February and broader macroeconomic pressures weighing on risk assets, the question arises: Is this just a correction, or are we witnessing the start of a prolonged downturn? Sorry to say, I’m now in the latter camp. After posting intraday lows around $86k — a nearly -20% retracement from its peak — the market may well be due for a bounce, but the support breakdown level is likely to provide firm resistance and it will take some serious force to get back into the range. It’s frankly hard to see a near-term catalyst for that. Bybit hack the last straw The recent Bybit hack — now attributed to a compromised Safe wallet developer — has shaken some investors’ confidence, perpetuating fear-driven selling. Bybit says it has replenished its ETH supplies and seems to have had no trouble servicing withdrawals, but the damage to market liquidity is evident. The hack’s fallout could also step up regulatory oversight, with Komodo Platform CTO Kadan Stadlemann suggesting that lawmakers may push to tighten consumer protections further. “This could include mandatory insurance for user funds, stricter licensing requirements for exchanges and the establishment of dedicated regulatory bodies to oversee cryptocurrency operations,” Stadlemann told Blockworks. Outflows, liquidations and rate uncertainty Aside from the Bybit hack, MEXC COO Tracy Jin attributes bitcoin’s decline to a combination of ETF outflows and macroeconomic uncertainty. “Bitcoin has broken through the $90,000 level, triggering liquidations worth over $1 billion,” Jin noted. “ETF outflows have persisted for six consecutive days, surpassing $2.4 billion in February alone.” For the moment, we still have no reason to doubt the Federal Reserve’s hawkish stance in delaying expected rate cuts until the second half of 2025. Higher-for-longer interest rates dampen demand for speculative assets like bitcoin, while new US tariffs stoke inflation concerns. (Not everyone is on board with this view, as noted in Truflation’s read above). Bright spots: Uniswap’s SEC win and Saylor’s Strategy Despite the bearish sentiment, there was a major win for DeFi yesterday: The SEC has dropped its investigation into Uniswap. Kevin Rusher, founder of RAAC, sees this as a pivotal moment. “The SEC dropping its investigation into Uniswap isn’t enough to drag the market out of its current hole, but it’s a massive win for crypto,” Rusher said. “This decision paves the way for a shift from memecoins to projects with real utility.”