A day that was not overly optimistic for the market adopted the surprising pleasure attributable to President Donald Trump’s announcement concerning a strategic crypto reserve fund consisting of BTC, ETH, SOL, ADA, and XRP. On the morning of March 4, the crypto market continued to witness a widespread “purple”, resulting in skepticism and a wave of sell-offs throughout crypto markets, which might be attributed to a mix of things based mostly on present market dynamics and up to date occasions.
How did the market dump?
In accordance with CoinMarketCap, Bitcoin value surprisingly declined this morning (March 4, 2025) (U.S time). In 24 hours, the value of this asset dropped by 11%, at one level hitting 82,400 USD/BTC and wiping out greater than 200 billion USD in market cap.
Supply: Coinglass
Not simply BTC, your complete market is awash in purple, with Ethereum falling 15.6% over the previous 24 hours, XRP dropping 18.7%, BNB declining 9%, Solana plunging 20%, Dogecoin reducing 16.4%, and Cardano tumbling 26.3% throughout the identical interval.
The same development was noticed within the inventory market, as main shares skilled declines following Trump’s announcement that tariffs would take impact tomorrow.
Supply: Cointelegraph
The explanation behind the purple stretching throughout your complete market
Bitcoin ETFs large outflow
Throughout the week of February 24 to twenty-eight, cryptocurrency ETFs skilled notable withdrawals, with Bitcoin funds seeing outflows of $2.61 billion and Ether funds dropping $335.35 million. On February 26, a record-setting $1 billion was pulled from Bitcoin ETFs in a single day, reflecting cautious market sentiment.
Among the many largest outflows, BlackRock’s IBIT led with $1.17 billion, adopted by Constancy’s FBTC with $568.65 million and Grayscale’s GBTC with $188.84 million. Different funds additionally noticed vital withdrawals, together with Grayscale’s BTC ($147.93 million), Valkyrie’s BRRR ($112.84 million), and WisdomTree’s BTCW ($95.10 million).
Regardless of the continued development of withdrawals, Bitcoin ETFs noticed a small influx on the ultimate day of the week, providing a slight shift after eight consecutive days of outflows.
Supply: Cointelegraph
Bybit cyberattack
One of many causes given is the Bybit cyberattack – which resulted within the acts of selling-off ETH. The most recent cyberattack on the centralized crypto trade Bybit, carried out by a widely known hacking group, led to the theft of greater than $1.4 billion USD in ETH, marking it as the largest cryptocurrency heist ever recorded.
On March 1, the cyber hackers transferred a further 62,200 ETH, leaving them with solely 156,500 Ethereum remaining from the preliminary haul, as reported by crypto analyst EmberCN. This newest motion pushes the whole laundered quantity to roughly 343,000 ETH, accounting for about 68.7% of the 499,000 ETH stolen within the February 21 assault. At this price, the remaining of the funds was estimated to be laundered at the moment.
This large sell-off stress, mixed with the hackers doubtlessly unloading their remaining 156,500 ETH, might have flooded the market, driving Ethereum’s value down. The Ethereum’s efficiency additionally influenced the broader altcoin market, resulting in the synchronized declines in cash like XRP (-18.7%), Solana (-20%), Cardano (-26.3%).
Retaliation from China
In accordance with The New York Occasions, the response from America’s accomplice, particularly China, escalated a world dispute that has rattled governments and worldwide commerce. Mexico and Canada, the 2 different international locations focused by the Trump tariffs, had but to reply.
Early Tuesday, China launched tariffs on a variety of U.S. meals exports in response to the newest commerce measures from the Trump administration. This transfer added to ongoing international commerce tensions which have involved many international locations. Beforehand, Mr. Trump has positioned practically all items from China below a further 20 p.c tariff. Earlier, on February 4, he launched a ten p.c tariff, adopted by one other spherical of tariffs on Tuesday.
China’s finance ministry introduced that it might apply a 15% tariff on imports of U.S. rooster, wheat, corn, and cotton. Moreover, a ten% tariff was positioned on merchandise comparable to sorghum, soybeans, pork, beef, seafood, fruits, greens, and dairy objects. This raises considerations about an ongoing commerce conflict, making traders more and more cautious and extra deliberate of their funding selections.
