The Funding: Crypto liquid funds respond to the bitcoin crash

Bitcoin plunges more than 20% this week. Coinbase's crypto-backed lending product records record liquidations this week. Ether liquidations total $466 million after price failed at $2,500 and breached the $2,400 demand zone on Feb. 6, 2026. A trading firm loses $686 million after a looped Ether long position unraveled as ETH fell below $2,000. Prime brokerage and OTC desks purchased 32,000 BTC between Feb. 7-8, 2026, transferring roughly $2.24 billion into institutional cold storage; two major institutional custodians received 41,000 BTC on Feb. 8, 2026, moving about $2.87 billion into segregated institutional wallets.