Crypto Market Faces Major Turmoil
The cryptocurrency market experienced a massive downturn, causing investors to lose $230 billion (₹19 trillion) in just a day. The Bitcoin price plummeted to $89,127, marking a 7% decline on February 25.
The primary reason behind this sharp drop is US President Donald Trump's proposed tariffs on Mexico and Canada, set to take effect from March 4. This policy has created market uncertainty, leading to an overall 8% decline in the crypto market.
Apart from Trump’s tariff announcement, multiple factors are contributing to the ongoing bearish trend in the cryptocurrency market:
✔️ Global Trade Uncertainty – Investors are shifting towards safer assets amid fears of new US trade policies.
✔️ Weak Investor Sentiment – The crypto market has been under pressure for the past eight weeks, making investors cautious.
✔️ Poor Performance of Meme Coins – Several small-cap cryptocurrencies (meme coins) have crashed, increasing market volatility.
✔️ Low Capital Inflow – The lack of new token launches and insufficient liquidity have also contributed to the decline.
Bitcoin’s drop has also triggered massive losses in other major cryptocurrencies:
🔴 Ethereum (ETH) – The second-largest cryptocurrency fell 12% in the last two days.
🔴 Solana (SOL) – Over the past week, Solana has dropped by nearly 15%.
🔴 Dogecoin (DOGE) – The popular meme coin has declined by 13%.
Despite the ongoing downturn, Bitcoin found some support when MicroStrategy announced a $2 billion Bitcoin purchase last week. This move could potentially stabilize investor confidence and reduce market volatility.
Adding to the market’s woes, a major hacking incident took place last week. The crypto exchange Bybit suffered a $1.4 billion cyberattack, further shaking investor trust. Bybit has since assured its users that it plans to reimburse affected investors.
The cryptocurrency market remains highly volatile due to trade uncertainties, weak sentiment, and security concerns. While MicroStrategy's investment provides some optimism, the overall trend suggests continued instability in the coming weeks.
