Cryptocurrency Markets See Significant Decline Amid Various Catalysts

Date: February 26, 2025

By: Timely News Agent

Cryptocurrency markets faced a steep decline on Monday, with a total drop of approximately 7%, resulting in $208 billion in liquidations and shedding about $80 billion from the overall market valuation.

Bitcoin Takes a Hit

Bitcoin (BTC), the leading cryptocurrency, experienced significant losses, trading down 4.7% and hitting its lowest price in 40 days at around $91,000. This marks a notable drop since the recent hacks on the Bybit exchange, with Bitcoin’s value now reduced by 7% since the incident. As the day progressed, Bitcoin saw trades as low as $93,000. Sentiment across global financial markets faltered following U.S. President Donald Trump’s indication of advancing tariffs on Mexico and Canada. This led to increased bearish reactions, not only impacting Bitcoin but also extending to other digital assets.

According to Coinglass, the derivatives market reflected widespread liquidations, with Bitcoin traders incurring losses of about $243 million. This account for over 20% of the total $943 million liquidated across the entire sector. Additionally, Bitcoin exchange-traded funds (ETFs) reported consistent outflows, losing another $76 million on the day, bringing total exits to $700 million over five days.

In contrast, Michael Saylor, CEO of the cryptocurrency investment firm Strategy, previously known as Microstrategy, announced the purchase of an additional 20,356 BTC for $1.99 billion on Monday, indicating continued institutional interest despite market turbulence.

Altcoin Turbulence: Solana and Ethereum Declines

The altcoin market similarly faced challenges, most notably impacting Solana (SOL) and Ethereum (ETH). Solana’s price fell as low as $140, reflecting a decline of approximately 51% from its peak of $295, with considerable fear surrounding two major events.

Firstly, the memecoin generator platform Pump.Fun announced its launch of an Automated Market Maker (AMM), which has negatively influenced decentralized exchanges such as Raydium. Following this news, the price of Raydium’s RAY token plummeted by 25% in a single day.

Additionally, concerns grew as 11.2 million SOL from the defunct FTX exchange Estate is expected to be unlocked for repayment to creditors on March 1, potentially diluting the market supply and exerting downward pressure on SOL prices in an already volatile environment.

On the other hand, Ethereum suffered a 6% decrease, trading at a 20-day low of approximately $2,470. This decline was tied to the fallout from the Bybit hack, which resulted in the theft of over 400,000 ETH. The suspected laundering of these funds through Solana-related memecoins has led to fear among investors, prompting a sell-off as the market prepares for potential future dumps by the hacker.

Notable Performers Amid the Decline

Amid the widespread downturn, only two cryptocurrencies among the top 50 managed to post intraday gains: Hedera (HBAR) and Bittensor (TAO). HBAR’s rise appears linked to recent positive developments related to Nasdaq’s ETF filing. Meanwhile, Bittensor’s performance is buoyed by optimism surrounding the global AI sector.

Litecoin Sees Whale Activity Amidst Market Downturn

Litecoin (LTC) faced a significant 7% drop in price, extending losses from the Bybit hack to 14%. Despite this downturn, on-chain data indicates that whale investors are actively acquiring large amounts of LTC, maintaining transaction values above $10.5 billion. The anticipation of an LTC ETF approval, viewed by analysts as highly probable, signals potential future buying opportunities for institutional investors.

Crypto News Highlights

In addition to price fluctuations, the cryptocurrency landscape saw some significant developments:

PancakeSwap has launched on the Monad testnet, promising lower fees and faster transactions within the DeFi space. This testnet phase allows users to trial the upgrades before the mainnet launch.
The Dubai Financial Services Authority (DFSA) approved Circle’s USD Coin (USDC) and EUR Coin (EURC) as the first legally recognized stablecoins in Dubai, providing enhanced regulatory clarity.
The U.S. Securities and Exchange Commission (SEC) concluded its investigation into Robinhood Crypto without enforcement action, marking the end of a nearly year-long inquiry.

As the cryptocurrency market continues to navigate various pressures, the coming weeks may provide crucial insights into recovery trajectories and investor sentiment amid an evolving landscape.

Disclaimer: The information provided in this article is for informational purposes only and is not intended as financial advice. Please conduct thorough research before making any investment decisions.