Bitcoin kicked off February 2026 with continued volatility. According to the latest data from Gate on February 6, its price dropped 6.3% over 24 hours, trading in the $66,000 range. Meanwhile, a key on-chain metric—the Bitcoin supply in profit and loss—is converging. Historically, this convergence has precisely coincided with major market bottoms.
Professional investors are not leaving the market. DWF Labs founding partner Andrei Grachev observed that while retail trading has nearly stalled, "behind-the-scenes M&A activity is very active," and many revenue-generating companies are planning to go public.
Analyzing the Market Bottom: Technical Indicators and Sentiment Signals
The cryptocurrency market underwent a significant correction at the start of 2026. Bitcoin pulled back from last year’s high of around $126,000, at one point testing support at $60,000—a drop of about 40% from its peak.
On the Gate platform, as of February 6, Bitcoin’s 24-hour low was $59,800, and market sentiment was marked as "extreme fear."
Key on-chain data offers deeper insight. According to Glassnode metrics, 11.1 million BTC are currently in profit, while 8.9 million are at a loss. Historically, when these two numbers converge, it often signals the market has bottomed.
This pattern appeared precisely at the market lows in November 2022 (after the FTX collapse), March 2020 (COVID-19 shock), and during the cycle bottoms of 2015 and 2019. If convergence occurs at the current cost basis, it could mean spot prices are near the $60,000 level.
Insights from the DWF Founder: Virtual Bottoms and Capital Flows
In a recent commentary, DWF Labs founding partner Andrei Grachev shared his core view on the current market: "I believe the crypto market is now close to a bottom, and there may still be about 15% volatility around the Bitcoin price."
He explained that a "virtual bottom" has already formed: "Now, all the Bitcoin that could be sold has been sold… I’m not just talking about altcoins, but Bitcoin as well."
Capital flows in the market are showing clear divergence. Grachev noted that while professional investors are still actively allocating funds to real-world assets and projects with "grand visions," direct inflows into spot markets have nearly ground to a halt.
This divergence reveals different strategies among market participants. Investors holding cash can now transact under very favorable conditions, while retail funds are largely concentrated on speculative platforms like Pump Fun.
M&A Activity Under the Surface: Industry Consolidation and Value Discovery
Beneath the market’s calm surface, a wave of mergers and acquisitions is underway. Grachev stated plainly, "Behind-the-scenes M&A activity is very active; many projects and companies are being acquired."
This trend reflects the natural evolution of the crypto industry. As the market corrects, quality assets become more reasonably priced, and professional institutions with cash reserves and long-term vision see strategic acquisition opportunities.
Some companies with at least some revenue are even planning to go public. This transition from private to public markets shows the crypto sector is gradually integrating with traditional finance, and valuation frameworks are becoming more mature.
A surge in M&A activity often precedes market bottoms. It signals that insiders believe asset prices have reached or are near fair value, and that consolidation can create synergies to prepare for the next growth cycle.
Current Market Status: Data, Prices, and Future Catalysts
As of February 6, the crypto market as a whole remains in a consolidation phase. On the Gate platform, Bitcoin’s market cap stands at $1.3 trillion, with a market dominance of 58.3%.
Ethereum’s performance also reflects the overall market mood. According to Bitget data, Ethereum is currently priced at $1,945.47, down 6.64% in 24 hours. Short-term forecasts suggest the Ethereum price could reach $1,921.78 on February 7 and $1,922.85 on February 11.
Data from the derivatives market provides another perspective. The total notional open interest for all crypto futures has dropped to $105.9 billion, the lowest since April last year. In the past 24 hours, $679 million in crypto futures positions have been liquidated.
Looking ahead, Grachev believes "the crypto market is already quite mature," and growth will not come from a single source of capital. He expects institutions to enter through structured products, while consumer-facing tools will quietly grow their user base—for example, Xiaomi’s decision to pre-install crypto wallets on every new smartphone.
Investment Strategy Considerations: Positioning in the Current Market
As the market approaches a potential turning point, investors need to carefully consider their strategies. Grachev advises focusing on "projects with real business operations and commercial expansion," as these will naturally benefit from future market growth.
He points out that while most altcoins will rise after a bear market, only those with real products and users can achieve sustainable growth. "Tokens should enhance the product, not be the product itself."
From a risk management perspective, Grachev notes that pure market-making profits have become slim, and the era of earning solely by providing liquidity and reporting is over. Today’s top market makers are full-stack partners, supporting market entry strategies, user acquisition, partnerships, and more.
For the long-term outlook, several analysts remain optimistic. Murad has outlined 116 bullish reasons, suggesting Bitcoin could reach $150,000 to $200,000 in 2026. Grachev also expects a new all-time high in the first half of 2026.
Looking Ahead
Market sentiment often shifts at the most pessimistic moments. The historic convergence of Bitcoin’s supply in profit and loss is sending subtle signals, while repeated tests of the $66,000 range on Gate are becoming the battleground for bulls and bears.
As retail trading flows into speculative platforms, professional M&A capital is quietly positioning itself behind the scenes of the crypto world. Some revenue-generating companies are already planning to go public, and DWF founder Andrei Grachev believes the market is near a "virtual bottom."
With institutional capital potentially returning after January and regulatory frameworks becoming clearer, those who remain patient and accumulate quality assets near current price levels may be standing at the ideal starting line for the next cycle.
