The crypto market is in a full-scale meltdown, with $325 billion in market cap wiped out since Friday morning as of press time, according to data from Coinglass, which also shows that the largest drop was when $100 billion disappeared within one hour.
There were no major headlines covering the sudden crash, making it seem like not a big deal at all, almost as if no one even cared anymore.
Even meme coins, which had been on fire in recent weeks, have taken a severe hit. Liquidity has dried up across the board, raising concerns about even more downside.
The sell-off of course started with the Bybit hack on February 21 when North Korea’s Lazarus Group pulled off the biggest financial heist in history, draining $1.5 billion from Bybit’s Ethereum wallets. This theft was so big, it’s double the size of the previous record-holder, which is the $611 million PolyNetwork hack that happened in 2021.
Ethereum, which was already performing terribly, got even worse as traders scrambled to pull funds out, fearing another FTX-style collapse.
Even though Bybit CEO Ben Zhou quickly announced that the exchange would cover all losses, it wasn’t enough to restore confidence. Traders don’t forget billion-dollar hacks that easily.
At first, Bitcoin stayed out of the mess. However, once the S&P 500 tanked on Friday, Bitcoin broke down too. The second stocks started slipping, Bitcoin followed, losing its key $98,000 support level.
One major factor that sent Bitcoin spiraling was Citadel Securities, which announced yesterday that it was moving into crypto as a liquidity provider. Instead of reassuring traders, it triggered a “sell the news” reaction, with investors rushing for the exits.
Memecoins collapse, Bitcoin struggles
Solana, which has now dropped 22% since Friday. The memecoin sector, which had been one of crypto’s wildest success stories this year, is getting slaughtered. With Solana’s crash, traders dumped their memecoins en masse, draining the last bit of liquidity from the market.
This actually started when Argentina’s President Javier Milei publicly endorsed LIBRA, a Solana-based meme coin, which quickly pumped like crazy—until it crashed into oblivion, wiping out $4.6 billion in investor money.
The scandal-tainted Solana’s reputation, and now, with $1.72 billion in SOL tokens set to be unlocked on March 1, the market is preparing for even more selling pressure.
According to digital asset manager Arca, altcoins as a group have already lost between 30-80% since mid-December. Even Dogecoin, which had been riding on Elon Musk’s federal workforce cuts, is down nearly 7%.
Crypto-related stocks are also taking a beating, as Coinbase has fallen for six straight days, which is its worst losing streak in months. Bitcoin miner MARA Holdings, which already plunged 13% last week, has lost another 2.6% today, and Strategy (formerly MicroStrategy) is also slipping, despite doubling down on Bitcoin buys, per data from Google Finance.
On Monday, Strategy filed with the SEC, revealing that it had once again bought 20,356 Bitcoin between February 18-23 for $97,514 per coin, worth a total $1.99 billion.
This makes it one of the company’s biggest Bitcoin acquisitions ever, pushing Strategy’s total holdings to $47.7 billion—equivalent to 2.5% of all Bitcoin that will ever exist. The company funded this buy with proceeds from its $2 billion convertible bond sale last week.
