Bitcoin bulls lose $88k as Solana fee spike fuels leveraged shakeout

Bitcoin slipped below $88k as Solana fees spiked and whales sent BTC to Binance, triggering leveraged liquidations and broad altcoin weakness in thin liquidity.

Bitcoin (BTC) fell below $88,000 on January 25, 2026, following elevated transaction fees on the Solana network and significant whale transfers to the Binance exchange, according to on-chain data.

Bitcoin faces bear market

The cryptocurrency declined over both the prior 24-hour and seven-day periods at the time of reporting, with the drop coinciding with two notable on-chain developments, according to analyst Taha.

Large Bitcoin holders moved substantial amounts of the cryptocurrency to Binance on January 21, according to the analyst. Such exchange inflows have historically aligned with distribution or positioning ahead of selling, though they do not guarantee immediate price declines, Taha stated.

Transaction fees on the Solana network spiked on January 24, mirroring a similar event that occurred on October 10, 2025, according to the data. During the earlier incident, Solana fees surged while Bitcoin traded at higher levels, and the cryptocurrency’s price subsequently fell in the following weeks.

Fee spikes typically reflect peak network activity, often driven by automated trading bots and high leverage in decentralized finance applications, which can signal elevated market conditions, according to Taha. The analyst noted that Solana’s fee trends have previously coincided with Bitcoin corrections.

The Bitcoin decline triggered price drops across several altcoins, including Sui, Arbitrum, Cardano, and Ethena, according to market data. Ethereum fell below a key technical level, while Solana experienced a brief drop, indicating reduced risk appetite across major cryptocurrencies.

XWIN Research Japan analysts attributed the move to rising U.S. political uncertainty, including an increased probability of a government shutdown before the January 30 funding deadline, combined with thin market liquidity. Significant long liquidations occurred within a short timeframe, driven primarily by derivatives rather than spot selling, according to the research platform.

Open interest remained well below late-2025 highs, suggesting leverage had already been reduced before the recent price movement, the analysts stated.

The data indicates a market responding to concentrated activity and leverage unwinding, with the Solana fee spike appearing alongside the Bitcoin pullback, according to the analysis.