Quantum computing is moving from theory to long term strategic consideration, and Strategy (MSTR) has made it clear it intends to be proactive rather than reactive during the company’s Q4 earnings call on Thursday.

Strategy, the largest corporate holder of bitcoin, plans to initiate a bitcoin security program to coordinate with the global cyber, crypto, and bitcoin security community.

The company addressed growing discussion around quantum risk and reaffirmed its commitment to bitcoin security, framing quantum not as an immediate threat but as a future engineering challenge the network can prepare for.

Strategy reported a net loss of $12.4 billion for the quarter. Shares fell 17% on the day, trading as low as $104, but market focus quickly shifted to executive chairman Michael Saylor’s commentary.

Saylor revisited a long list of historical Bitcoin FUD (fear, uncertainty and doubt) that the network has already overcome quantum concerns, while acknowledging that quantum deserves serious long term planning.

The company outlined a range of key points on quantum computing, predicting that quantum technology is likely more than a decade away and pointing out that the Bitcoin community is already researching quantum-resistant cryptography.

Shares are up 6% in pre-market trading as bitcoin has rebounded to $65,000.

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Read More: Galaxy CEO Mike Novogratz doesn’t see quantum as big threat for bitcoin

Santiment says extreme fear after Bitcoin’s $60K drop helped trigger a rebound, with a potential push toward $70K.

Bitcoin (BTC) slipped to around $60,000 earlier today before rebounding toward $65,000, following one of the sharpest daily sell-offs in its history.

The move has split traders between those calling the rebound a temporary technical reaction and others pointing to extreme fear as a setup for a recovery toward $70,000.

Fear Spikes as Bitcoin Rebounds From Sell-Off

On February 6, Santiment noted that social media mentions calling for Bitcoin to go “lower” or “below” shot up after the drop to $60,000, a pattern the analytics firm said often appears near short-term price rebounds.

The asset did indeed bounce back to about $65,000, with the uptick coming after what The Kobeissi Letter described as BTC’s first-ever daily drop of more than $10,000, alongside claims that a large leveraged position had been liquidated.

“Is this nothing but a dead cat bounce?” Santiment asked, while positing that enough retail may have been shaken out to justify a quick rally back up to the $70,000s.

The sell-off capped weeks of heavy downside pressure, as CryptoPotato previously reported, with Bitcoin wiping out gains seen after Donald Trump’s re-election and dragging most major altcoins lower. XRP fell 13% on the day, while Ethereum, Solana, and BNB also posted steep losses.

Meanwhile, on-chain and derivatives data are painting a mixed picture beneath the rebound. According to DeFi commentator Marvellous, “smart money” has taken a net short position, while whales and public figures are adopting long positions. The market watcher argued the move looked more like a mechanical response after $2.2 billion in long liquidations than renewed conviction, noting that open interest remained elevated and funding rates had stayed flat.

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Elsewhere, trader Sykodelic highlighted a lopsided liquidation map, claiming the market had cleared most long positions, leaving roughly $29 billion in shorts versus about $100 million in longs over a one-year view.

Price Action Shows Heavy Damage Despite Short-Term Bounce

Bitcoin was trading around the $65,000 level at the time of writing, down nearly 9% in the last 24 hours and more than 21% over the past seven days. Across the previous month, the losses stand close to 30%, pushing BTC about 48% below its peak from October 2025, when it surpassed the $126,000 mark.

Analysts from CryptoQuant have said that the current downturn is developing faster than the 2022 bear market, with their data showing the OG cryptocurrency fell 23% within 83 days of losing its 365-day moving average, compared with a 6% decline over the same period in early 2022.

Santiment added that sentiment toward both Bitcoin and Ethereum (ETH) had turned “extremely bearish,” a condition that can coincide with short-lived relief rallies when retail fear stays elevated.

For now, traders remain divided. Some see the concentration of short positions and fearful sentiment as fuel for a move back toward $70,000, while others have warned that without a collapse in open interest and prolonged sideways trading, the recent bounce may only be the precursor to another test of lower levels.

Secure Digital Markets sent $1M in Bitcoin to Kraken over Lightning, showcasing near-instant, low-fee settlement for institutional-size payments.

The operation was facilitated by Voltage’s Lightning enterprise infrastructure. Voltage is a Bitcoin payments and infrastructure provider focused on institutional clients.

The pilot project was designed to test whether the Lightning Network can support high-value transfers between regulated counterparties, according to SDM. The institutional trading and lending desk said the pilot demonstrated how Lightning can support use cases such as internal treasury movements, high-value settlements, and transfers between trading venues without the delays associated with on-chain settlement.

“Moving $1 million to Kraken via Lightning Network marks a definitive shift in global settlement architecture,” said Mostafa Al-Mashita, co-founder and director of sales and trading at SDM. “We have moved beyond the era of questioning Bitcoin’s institutional capacity.”

Kraken has supported Lightning for retail payments for several years. The company said the transaction reflects growing demand from institutional clients for faster settlement options.

Bitcoin Lightning Network used in investment

“Milestones like this demonstrate what’s possible when innovation meets real-world demand,” said Calvin Leyon, head of on-chain at Kraken. “By drastically reducing settlement times, Lightning Network unlocks Bitcoin’s potential on a global scale.”

Graham Krizek, founder and CEO of Voltage, said the transaction highlights the network’s maturity and its ability to meet enterprise requirements.

Kalshi is expanding its surveillance framework on its prediction markets platform through an independent advisory committee and strategic partnerships designed to deter insider trading and market manipulation, a move announced just days before a major U.S. betting event. The company said the committee will provide a quarterly briefing to outside counsel and publish statistics detailing investigations into suspicious activity on the platform. In parallel, Kalshi is partnering with Solidus Labs, a crypto trading surveillance platform, and Daniel Taylor, director of the Wharton Forensic Analytics Lab, to bolster detection, auditing, and response to potential market abuse. The timing places the initiative squarely ahead of Super Bowl 60, as Kalshi’s bet volume continues to climb well ahead of the big game. The company disclosed that more than $168 million in bets had already been placed on Kalshi ahead of the event, underscoring the scale of activity in its event-contract market.

Key takeaways

• Kalshi formalizes an independent advisory committee that will deliver quarterly oversight reports to external counsel and publish platform-cleaning statistics on investigations into suspicious activity.
• The collaboration with Solidus Labs and Wharton’s Daniel Taylor signals a structured, cross-disciplinary approach to detecting and mitigating market abuse on prediction markets.
• As regulators and lawmakers intensify scrutiny of prediction markets, Kalshi faces ongoing regulatory attention while seeking to expand access to institutional participants.
• Market context around margin trading for event contracts is evolving, with Kalshi reported by the Financial Times to be seeking U.S. regulatory approval for margin-enabled trading, potentially broadening participation beyond accredited or high-net-worth investors.
• Key personnel in the enforcement and analytics sphere—Lisa Pinheiro of Analysis Group, Kalshi’s head of enforcement Robert DeNault, and former U.S. Treasury official Brian Nelson—anchor the program’s governance and compliance posture.
• State regulator focus on whether sports-event contracts constitute gambling persists, highlighting a broader regulatory risk backdrop for Kalshi and peers in the prediction-market space.

Tickers mentioned: $BTC, $ETH

Sentiment: Neutral

Market context: The move comes amid heightened regulatory attention on prediction markets and a broader push toward compliant, institution-friendly structures in crypto-related markets. As lawmakers debate the boundaries of insider trading and official influence, Kalshi’s governance enhancements and potential margin-trading roadmap align with a sector-wide push toward transparency and risk controls.

Why it matters

The expansion of Kalshi’s surveillance apparatus marks a significant step in maturing prediction markets as legitimate financial venues. By embedding an independent advisory committee and engaging third-party researchers and surveillance firms, the platform seeks to reduce the risk of manipulation and improve trust among users and potential institutional participants. The quarterly reporting obligation to outside counsel and the public release of investigation statistics could create a measurable benchmark for the platform’s compliance processes, offering a model that other prediction-market operators may emulate in a landscape where regulatory expectations are converging with industry practices.

Partnering with Solidus Labs, a known surveillance provider in the crypto trading space, and with Daniel Taylor of Wharton’s Forensic Analytics Lab signals a deliberate attempt to fuse technocratic oversight with academic rigor. This combination can enhance anomaly detection, forensic tracing, and incident response. In a market where a single high-profile manipulation incident or insider-trading allegation could reverberate across platforms, a robust governance framework is not merely a compliance checkbox but a practical risk-management tool.

At the same time, the industry faces a regulatory environment that can shift quickly. The sector has seen proposals in Congress and state-level actions that challenge the legality or structure of prediction-market contracts, especially when they intersect with political events or government insiders’ moves. Kalshi’s effort to cement a governance layer alongside external expertise is thus as much about resilience against ongoing regulatory scrutiny as it is about preventing abuse. If the market can demonstrate lower risk through transparent processes and independent oversight, it may unlock broader participation from institutional players who have been hesitant to engage with prediction markets under uncertain compliance regimes.

The Financial Times reporting that Kalshi is pursuing margin-trading authorization in the United States adds another dimension to the story. Margin trades could allow participants to leverage bets on event outcomes in a manner eerily reminiscent of traditional futures markets, potentially expanding the pool of capital and the depth of liquidity. Kalshi is said to be in discussions with the Commodity Futures Trading Commission for months to enable this feature, which would structure margin exposure similarly to other futures contracts—depositing a fraction of the contract value and settling at close. If approved, such a feature could attract a broader spectrum of investors, from hedge funds to family offices, while heightening the need for robust surveillance and risk controls to manage leverage and systemic risk.

The governance roster backing Kalshi’s new program includes prominent names. Lisa Pinheiro, a managing principal and data scientist at Analysis Group with a focus on market manipulation, brings a rigorous analytics lens to the effort. Kalshi’s own enforcement head, Robert DeNault, has been positioned to coordinate enforcement with the new committee, ensuring alignment between policy and day-to-day operations. Adding to the advisory depth is Brian Nelson, a former U.S. Treasury official who previously handled terrorism financing and financial-intelligence matters, who has been brought in to advise on trading surveillance and compliance issues. This blend of academic insight, legal enforcement leadership, and government-facing regulatory experience suggests a holistic approach to risk management that goes beyond surface-level compliance checks.

While the shift toward enhanced governance is framed as a proactive defense against abuse, it also occurs within a broader debate about the legal status of prediction markets. Kalshi remains among a handful of prediction-market operators that regulators have scrutinized, with some states arguing that sports-event contracts can resemble illegal gambling. Kalshi and its peers dispute that characterization, highlighting their compliance posture and the distinctions between prediction-market mechanics and gambling. The evolving regulatory dialogue—coupled with potential margin-trading approvals—could reshape how prediction markets function in practice, potentially increasing their legitimacy in the eyes of mainstream financial markets and mainstream regulators alike.

Finally, the strategic angles extend beyond regulatory maneuvering. The Kalshi announcements come as the broader market looks to how prediction markets can coexist with traditional financial infrastructure and institutions. The push toward more formal governance, transparency, and risk controls may help anchor the industry’s legitimacy in a landscape that is increasingly sensitive to issues of surveillance, data integrity, and governance. If Kalshi’s approach proves effective, it could become a blueprint for how prediction-market platforms demonstrate resilience, attract capital, and operate within a stricter regulatory framework that emphasizes accountability as a condition for growth.

What to watch next

• Publication of Kalshi’s quarterly surveillance report to outside counsel and any accompanying public statistics.
• Regulatory developments from the CFTC regarding margin trading for event contracts and Kalshi’s progress on any required approvals.
• State regulator updates related to the classification of sports-event contracts and any enforcement actions affecting Kalshi and peers.
• Updates on Super Bowl 60 betting volumes and any shifts in participant composition or contract availability on the Kalshi platform.

Sources & verification

• Kalshi press release announcing an independent advisory committee and quarterly reporting on investigations into suspicious activity: https://news.kalshi.com/p/kalshi-surveillance-insider-trading-prevention
• Financial Times report on Kalshi seeking regulatory approval to offer margin trades in the US
• U.S. congressional coverage of insider-trading concerns in prediction markets, including the Ritchie Torres bill
• Related market coverage on Polymarket/Circle and USDC settlement context

Market reaction and key details

Kalshi is actively expanding governance and surveillance as it positions itself for broader participation and potential product expansion. The combination of an independent advisory committee, external partnerships, and leadership with enforcement and analytical credentials aims to strengthen confidence in the platform’s integrity, particularly during a peak betting period like Super Bowl 60 and amid regulatory uncertainty. The reported margin-trading initiative, if approved, would mark a notable shift in the platform’s approach to liquidity and investor access, coordinating with ongoing regulatory dialogue and risk-management enhancements to support a more institutional-grade operation.

Why it matters

Kalshi’s governance push matters because it signals a maturing industry that recognizes the need for structured oversight to sustain growth. Independent advisory input and transparent reporting can improve user trust, reduce perceived risk, and potentially attract a wider array of participants who require verifiable controls before committing capital. For developers and operators building in the prediction-market space, the Kalshi framework may serve as a reference point for blending legal compliance with advanced analytics and cross-industry surveillance expertise.

From an investor perspective, enhanced risk controls and the prospect of margin trading represent both opportunities and caveats. While the potential for deeper liquidity and broader participation can support price discovery and volatility management, it also heightens the importance of robust risk management, real-time monitoring, and clear compliance protocols. In an environment where regulators are increasingly attentive to how digital markets operate, platforms that can demonstrate proactive governance are more likely to withstand regulatory shocks and sustain long-term growth.

For users, the development promises more transparency around how suspicious activity is identified and handled. Quarterly reports and external oversight may illuminate how the platform handles investigations, how often corrective actions occur, and how such actions influence market integrity. If the surveillance and enforcement ecosystem expands as described, users could benefit from a more predictable, accountable trading environment, especially during high-stakes events that generate outsized betting activity.

What to watch next

• Kalshi’s first quarterly surveillance report rollout and any accompanying data releases.
• Regulatory decisions from the CFTC on margin-trading approvals for event contracts.
• State-level regulatory actions related to prediction markets and sports contracts.
• Updates on Kalshi’s collaboration outcomes with Solidus Labs and Wharton analytics researchers.

Bitcoin’s recent rebound has revived the buy-the-dip narrative, but the data tells a more complicated story. After falling nearly 15% and briefly touching the $60,000 zone, the Bitcoin price bounced more than 11%, drawing traders back into long positions.

At first glance, the bounce looks encouraging. However, bearish chart patterns, rising leverage, and fragile spot demand suggest the market may not be out of danger yet. With a potential 25% downside still in play, the latest bounce is now facing serious scrutiny.

Bear Flag, Rising Leverage, and Falling Exchange Supply Signal Risky Optimism

Bitcoin’s short-term risk is already visible on the 4-hour chart.

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After the sharp sell-off toward $60,000, the Bitcoin price formed a rebound structure that now resembles a bear flag pattern. This setup typically appears when the price pauses after a strong drop before continuing lower. If the lower trendline breaks, the pattern points to a downside move of nearly 25%, targeting the $48,000–$49,000 zone.

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Despite this technical warning, leverage is rising again.

Following the 11.18% rebound, more than $540 million in new long positions were built on Binance alone. This shows that traders are once again using heavy leverage, betting that the bottom is already in. Similar behavior has preceded major liquidations in past downturns.

At the same time, spot market behavior reflects a growing buy-the-dip mindset.

Bitcoin supply on exchanges fell from around 1.23 million BTC to 1.22 million BTC between February 5 and February 6. This decline suggests that traders are withdrawing coins, possibly for short-term holding, expecting higher prices.

Public figures and social media sentiment have also turned more optimistic, reinforcing the ‘Buy-the-Dip’ narrative.

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Together, these signals possibly show misplaced confidence.

A fragile chart pattern, rising leverage, and early dip buying are forming at the same time. When optimism builds before structural weakness is resolved, downside risk often increases rather than fades.

Long-Term Holders Keep Selling as Realized Price Support Comes Into Focus

While short-term traders are turning bullish, long-term holders, the most stable folks, are moving in the opposite direction.

The Long-Term Holder Net Position Change, which tracks the 30-day supply shift among investors holding for more than one year, has remained deeply negative since early January. On January 6, this metric showed net selling of around 2,300 BTC. By February 5, that figure had worsened to roughly 246,000 BTC.

This represents a nearly 10,500% increase in long-term distribution in just one month. In simple terms, the most conviction-driven investors are still reducing exposure.

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This behavior becomes more concerning when combined with the long-term holder realized price.

The realized price represents the average acquisition cost of coins held by long-term investors. Historically, when Bitcoin approaches or falls below this level, it signals deep market stress. In past cycles, major rallies only began after the price stabilized around this zone; however, not immediately.

Currently, the long-term holder realized price sits near $40,260.

As Bitcoin moves closer to this level, more long-term investors approach breakeven. If the price drops below it, many enter losses, often accelerating capitulation. This dynamic played out in late 2022 before the final bear market bottom formed.

So far, that reset has not happened.

Long-term holders are still selling, not accumulating. Their realized price is becoming a key downside magnet. This suggests the market has not completed its full deleveraging and redistribution phase.

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Key Bitcoin Price Levels Show Why $48,000 and $40,000 Matter Next

All technical and on-chain signals now converge around a few critical price zones.

On the downside, the first major support sits near $53,350. A failure here would expose the $48,800 region, which aligns with the bear flag target and prior consolidation zones.

If $48,800 breaks, attention shifts to the long-term holder realized price near $40,260.

This zone represents the deepest structural support in the current cycle. A move into this region would indicate broad capitulation among long-term investors and confirm a deeper bear phase.

In a worst-case scenario, extended weakness could even open the door toward $37,180, based on longer-term projections and historical support clusters.

On the upside, Bitcoin must reclaim $69,510 on a sustained 4-hour closing basis to regain short-term credibility. A move above $73,320 would be required to invalidate the bearish pattern.

Until that happens, rallies remain vulnerable.

With leverage rebuilding, long-term holders still selling, and critical support levels approaching, the current rebound lacks structural confirmation. Under these conditions, buy-the-dip strategies remain exposed to sharp reversals rather than sustained upside.

BitMine Immersion Technologies (BMNR), the world’s largest Ethereum-focused treasury company is now sitting on nearly $8 billion in paper losses after ether ETH$1,907.78 fell below $2,000 on Thursday.

The firm, helmed by well-followed Wall Street bull Thomas Lee, accumulated 4.29 million ETH at an estimated cost of $16.4 billion, according to data from DropStab. That stash is now worth just $8.4 billion at current prices.

BMNR stock fell another 9% Thursday to its lowest point since the company pivoted to an Ethereum strategy. It has now tumbled 88% from its July peak, as investor concern grows on the firm’s ETH exposure and collapsing prices.

Despite the sharp drawdown, BitMine is under no immediate pressure to liquidate its assets. Unlike many other digital asset treasuries, the company used equity issuance — and not borrowed funds — to fund its ether purchase spree and other investments.

The firm also holds $538 million in cash and has begun generating income from staking more than 2.9 million ETH, according to its Monday update.

“There is no pressure to sell any ETH at these levels, because there are not debt covenants or other restrictions/provisions,” Thomas Lee said in a statement, “BitMine is in a position to ride out crypto volatility while earning recurring income and staking rewards.”

Metaplanet’s CEO Simon Gerovich doubled down on the company’s Bitcoin-first strategy as the wider crypto market suffered one of its harshest drawdowns since 2022.

“[T]here is no change to Metaplanet’s strategy. We will steadily continue to accumulate Bitcoin, expand revenue and prepare for the next phase of growth,” Gerovich said Friday on X, according to a machine translation of his post.

Metaplanet’s stock on the Tokyo Stock Exchange closed Friday down 5.56% at 340 yen (about $2.16).

The corporate crypto whale is ranked fourth among public Bitcoin (BTC) treasury companies behind Strategy, MARA holdings and Twenty One Capital. Metaplanet held 35,102 on Friday, according to BitcoinTreasuries.NET.

Related: Metaplanet approves $137M overseas raise to buy Bitcoin and repay debt

Bitcoin treasuries are sitting on unrealized losses

As of Friday, Bitcoin was down about 50% from its all-time high of $126,080 set in October, 2025. The Crypto Fear & Greed Index, a gauge of market sentiment, fell to its lowest reading since the Terra Luna crash in May 2022.

According to Coinglass, $1.844 billion of crypto long positions were liquidated on Thursday.

Corporate Bitcoin whales were also displaying losses on their balance sheets. Strategy, the largest public holder of Bitcoin, logged a $12.4 billion net loss in the fourth quarter of 2025, as Bitcoin dropped below the firm’s average purchase price of $76,052. 

Strategy’s shares had dropped 17% on its Thursday call, even as the company said that its capital structure remained “stronger and more resilient” and that it had no major debt maturing until 2027.

Bitcoin treasuries are sitting on unrealized losses

Strategy’s latest disclosure showed it bought another 855 BTC on Monday, worth about $75 million.

​Like Strategy, Metaplanet hasn’t signaled plans to unwind its exposure or sell its Bitcoin holdings. Metaplanet’s average cost for its Bitcoin holdings is $107,716, according to BitcoinTreasuries.NET.

Crypto treasuries based on assets other than Bitcoin are feeling the pressure as well. Ethereum treasury Bitmine held around 1.17 million Ether (ETH), while sitting on more than $8.25 billion in unrealized losses.

Big questions: Would Bitcoin survive a 10-year power outage?