Bitcoin Falls $60,000, Fear Index Hits “6” – A Dark Week for Crypto Assets, Brought About by China’s “Silver Shock” and the Epstein Papers
[Market Overview: 32% Plummet in 8 Days and Extreme Fear] On February 6, 2026, global financial markets were hit by a chain reaction of panic selling. Bitcoin, which had been trading at $88,000 as of January 29, plummeted to $60,000 in just eight days, a 32% drop. The “Crypto Fear & Greed Index,” which measures investor sentiment, hit a record low of “6,” and the market was dominated by extreme pessimism. Behind this historic crash lay a complex interplay of three major factors: a liquidity crisis originating in China, turmoil in U.S. stocks due to the AI investment race, and the “Satoshi Nakamoto Survival Theory” fueled by the release of the Epstein Papers.
[First Factor: The Epstein Papers and the Shadow of “Satoshi Nakamoto”] Signs of a potential crash began with the release of the Epstein Papers on January 30th. The released documents included an email sent by the late Jeffrey Epstein to the Saudi royal family in 2016, in which he wrote, “I’ve already been in contact with several Bitcoin founders,” and “They’re very excited.” While Bitcoin creator Satoshi Nakamoto had previously been believed to be dead or permanently missing, the documents suggested he (or they) may actually exist and be active. Satoshi’s wallets held approximately 5% of the total Bitcoin supply, sparking widespread speculation that this might be sold on the market. The potential fear of whale selling weighed on the market’s upside, paving the way for a potential crash.
[Second Factor: Collapse of the Chinese Silver Fund and Forced Liquidation] The direct trigger for the market’s collapse came from the Shanghai market. China’s largest silver ETF, the Guotou Rui Silver Futures (LOF), listed on the Shenzhen market, lost approximately 30% of its net asset value in an instant following a change in valuation rules on February 2, resulting in a four-day consecutive daily limit drop. Investors caught in a “liquidity trap”—where transactions were not executed—met with a margin call deadline on the evening of February 4. Instead of silver funds that could not be liquidated, the system automatically began indiscriminately selling Bitcoin and gold, which were “saleable assets” in their accounts. This was the true nature of the vertical crash that occurred around 11:00 AM JST on February 5, accelerated by demand for liquidation sales ahead of the Chinese New Year.
[Third Factor: Google Earnings and the AI Investment Dilemma] Headwinds from the stock market also weighed heavily on the market. Despite reporting strong earnings, Google (Alphabet) announced plans to double its capital expenditures to $185 billion (approximately ¥27 trillion) in 2026, sending its stock price plummeting. Markets worried that massive investments in AI infrastructure could squeeze profits led to widespread selling, particularly in software-related stocks. This risk-off sentiment spread across the stock market, further reducing capital inflows into the cryptocurrency market.
[The Test of the “Digital Gold” Myth] This crash was the result of a catastrophic combination of psychological factors—fear of founder selling due to the Epstein documents—and physical factors—forced liquidation due to the collapse of a Chinese silver fund. Bitcoin was establishing itself as “digital gold,” but the risk of its value being eroded by a single move by a large holder has become clear. For the market to regain stability, supply and demand must be rebalanced by the resumption of silver fund trading in the Chinese market, and concerns about Satoshi Nakamoto must be allayed.
