Recently, the cryptocurrency market has been turbulent, attracting widespread attention from investors. In the early morning of February 25, the price of Bitcoin once broke through $91,000, hitting a new low since mid-January, and fell by 5% in 24 hours; mainstream currencies such as Ethereum and Solana fell by more than 10%, and the number of people who were liquidated on the entire network exceeded 315,600, and the amount of liquidation reached $950 million, setting a new record for single-day liquidation this year. As of February 27, the price of Bitcoin continued to fall, falling below the key support level of $85,000 during the day, and the lowest reached below $83,000, setting a new low since November last year.
The direct cause of the plunge was the aftermath of the hacker attack on Bybit , a cryptocurrency exchange headquartered in Singapore, on February 21. Hackers exploited platform vulnerabilities and successfully stole more than 400,000 ETH and stETH with a total value of more than $1.5 billion and transferred them to unknown addresses. Although Bybit quickly used its own funds to restore all customer assets, the scale of the attack and the huge amount of money involved are the largest in the history of cryptocurrency, which has dealt a heavy blow to the industry and triggered widespread concerns among investors about the security of the cryptocurrency market. According to the FBI announcement, the North Korean hacker group was confirmed to be responsible for the incident, and the FBI urged participants in the cryptocurrency ecosystem to completely block transactions related to hacker money laundering addresses.
The Bybit hack is not an isolated incident. In the past few weeks, a series of scams related to meme coins have occurred one after another. Argentine President and cryptocurrency enthusiast Javier Milley once supported a meme coin called Libra, which turned out to be a multi-billion dollar scam. Meme coins associated with First Lady Melania Trump also caused investors to lose billions of dollars, and similar situations occurred with meme coins associated with President Trump, which further exacerbated market panic.
There are also many unstable factors at the macroeconomic and policy levels. On February 24, Trump publicly stated that he would impose tariffs on imports from Canada and Mexico and promote the "reciprocal tariff plan", triggering market panic about "Trade War 2.0". Investors have sold risky assets such as Bitcoin and turned to traditional safe-haven tools such as gold and U.S. bonds. The U.S. dollar index has soared, and the Bitcoin ETF has a net outflow of US$546 million in a single week, and institutional funds have accelerated their withdrawal. On February 27, Trump once again emphasized that he would not stop imposing tariffs. If implemented as scheduled on March 4, global economic uncertainty will increase significantly, and assets such as Bitcoin may be further sold off. In addition, South Dakota postponed the bill allowing state governments to invest in Bitcoin , and the European Union included Russian cryptocurrency exchanges on the sanctions list for the first time, further exacerbating policy uncertainty.
Industry insiders have different views on the future trend of the crypto market. In the short term, the market is still full of uncertainty and downward pressure. Katie Stockton, a well-known cryptocurrency analyst, pointed out that if Bitcoin cannot effectively break through the key resistance level, the risk of price correction is relatively high. Once the price of Bitcoin continues to be below the key support level of $93,000, market panic may spread further. In addition, the EU's sanctions on Russian cryptocurrency exchanges and the possible subsequent investigation by the US Securities and Exchange Commission (SEC) will significantly increase the compliance costs of cryptocurrency exchanges, especially small and medium-sized platforms, which will face severe challenges in survival when their financial strength and compliance response capabilities are relatively weak. The implementation progress of zero-knowledge proofs (zk-Rollups) and AI risk control systems will become a key factor in rebuilding market confidence. If these technologies can be quickly implemented and effectively applied, they will improve the security and efficiency of cryptocurrency transactions and help stabilize market confidence; otherwise, the market's wait-and-see sentiment will continue and downward pressure will be difficult to ease.
In the long term, some industry insiders are optimistic about the crypto market. Richard Teng, CEO of Binance, predicts that Bitcoin will hit a record high in 2025, driven by regulatory changes under Trump, strategic initiatives in the United States, and momentum in support of cryptocurrencies. From the perspective of institutional investment, institutions, governments, and companies are increasingly interested in Bitcoin . So far this year, investors have invested $4.3 billion in Bitcoin ETFs , and this figure is expected to reach $50 billion by the end of the year, with hundreds of billions of dollars more in the coming years. Large financial institutions such as BlackRock, Fidelity, and Morgan Stanley have begun betting on digital asset investment tools, and some U.S. state pension funds have also begun investing in Bitcoin ETFs , indicating that institutional investors are gradually recognizing the investment value of cryptocurrencies.
In terms of regulation, Washington is in the early stages of a major shift in its attitude toward cryptocurrencies. The SEC’s withdrawal of high-profile lawsuits against companies such as Coinbase, while lawmakers have reached a consensus on pro-cryptocurrency bills related to stablecoins and market structure, heralds a more friendly regulatory environment for the cryptocurrency industry, which will attract more capital inflows, push cryptocurrencies into the mainstream financial field, and significantly reshape the financial landscape in the coming years.
The stablecoin market is also promising, with its assets under management (AUM) reaching a record high of $220 billion, up nearly 50% from last year. As stablecoin-related legislation advances in Congress, it is expected that the market size could surge to $1 trillion by 2027. Decentralized finance (DeFi) is also welcoming new development opportunities, with increasingly active activities in areas such as lending, trading, prediction markets, and derivatives. The AUM of tokenized real-world assets (RWA) is hitting record highs every day, and is expected to become an important driving force for the next round of growth in the crypto market.
The crypto market has experienced ups and downs recently. Hacker attacks, Meme coin scams, macroeconomic and policy changes, and technical factors have combined to cause severe market turbulence and huge challenges for investors. However, despite the uncertainty of the short-term outlook and significant downward pressure, from a long-term perspective, the crypto market still contains many positive factors. Whether it is the gradual recognition of institutional investors, the increasingly friendly regulatory environment, or the booming stablecoin market and decentralized finance, they all provide a solid foundation for the future growth of the crypto market. At a time when opportunities and challenges coexist, the future direction of the crypto market depends not only on the coordinated promotion of technological innovation and regulatory improvement, but also on the global economic situation and policy orientation. Investors need to remain rational and cautious and pay close attention to market dynamics in order to seize opportunities and deal with risks in this emerging field and witness the continuous development and reshaping of the crypto market in the midst of change.
