Market Brief: Liquidation Surge & Risk-Off Sentiment **February 3, 2026** The cryptocurrency market has faced a severe contraction, validating reports of a massive $2.56 billion loss in collective liquidations over recent days. This sharp downturn was primarily triggered by the nomination of Kevin Warsh as the next Federal Reserve Chair, a move interpreted by investors as a signal for tighter monetary policy and a stronger U.S. dollar. Bitcoin (BTC) bore the brunt of this volatility, plunging below the **$75,000** support level earlier this week—its lowest point since April 2025. While prices have staged a mild recovery to trade near **$78,400**, the market remains fragile. Sentiment has deteriorated significantly, with the Fear & Greed Index dropping to **17**, indicating "Extreme Fear" among traders. This sell-off was not isolated to digital assets. Precious metals experienced a simultaneous crash, dismantling the "safe haven" narrative. Silver futures plummeted approximately **16%**, while Gold retreated by roughly **6.5%**, as the strengthening dollar reduced the appeal of non-yielding assets. The technology sector also contributed to the bearish atmosphere. Investor anxiety regarding the evolving AI landscape has intensified, driven by concerns over sustainable returns on massive infrastructure spending by major tech firms. This skepticism created a correlation between tech stocks and crypto, amplifying the selling pressure across all high-risk categories. Market participants are now exercising extreme caution, waiting to see if the **$75,000** floor for Bitcoin holds or if the "risk-off" environment will drive further de-risking in the days ahead.