Bitcoin plunged below $11K for a while, down 40%+ from record high of ~$19.8K at the start of the week, amid a crash in all major cryptocurrencies
Evelyn Cheng / CNBC :
Context & Ripple Effects
This closes out a week-long unwind: Bitcoin had set its record near $19.8K at the start of the week, then fell through $11,000 on Coinbase specifically, with every major cryptocurrency selling off alongside it rather than decoupling.
The drawdown did not mark a bottom — three weeks later Bitcoin was briefly below $10K in January's second leg down, which also dragged Ethereum and Ripple harder than Bitcoin itself. The pattern matters because it recurred: the same exchange-and-plunge dynamic showed up again in May 2021, when Coinbase went down for some users mid-crash.
First-order effects
- Retail holders buying near the week's ~$19.8K peak are sitting on 40%+ losses within days, concentrated on Coinbase where the sub-$11K print occurred.
- The synchronized crash across all major cryptocurrencies means diversification within crypto offered no protection — altcoin holders absorbed the same drawdown as Bitcoin.
Second-order effects
- Exchange infrastructure becomes the stress point: when volume spikes coincide with price collapses, platforms like Coinbase face outages exactly when users most need to trade, as the 2021 repeat confirmed.
- Correlated selling pushes attention to relative damage — Ethereum's and Ripple's steeper percentage declines in the January follow-on shift marginal capital toward Bitcoin as the perceived least-risky crypto holding.
Third-order effects
- If the pattern holds, large double-digit drawdowns are a structural feature of the asset rather than one-off events: the corpus shows 40%+ weekly drops in late 2017, another sharp decline weeks later, sub-$60K prints after an October 2024 low, and a roughly 50% fall from an October 2025 peak.
- Repeated crashes under rising mainstream participation push the market toward the exchange reliability and custody questions that determine whether retail capital stays invested between cycles.
The trend: Cryptocurrency markets keep reproducing the same boom-bust drawdown cycle at ever-larger scale, with exchange infrastructure repeatedly failing under crash conditions.